Mortgage applications for new home purchases increased 8.2% on a year-over-year basis in October, according to the Builder Application Survey from the Mortgage Bankers Association. Applications ticked up 3% sequentially compared to September 2024 levels.
“New home purchase activity picked up in October even as stronger economic data and election uncertainty pushed mortgage rates higher over the course of the month,” says MBA vice president and deputy chief economist Joel Kan. “Both new applications and estimated home sales were higher compared to year-ago levels. New homes are an attractive alternative for many buyers as existing inventory is still tight in many markets across the country and a newly constructed home provides additional customization options.”
The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 747,000 in October 2024, a 9.9% increase from the pace in September. On an unadjusted basis, the MBA estimates there were 56,000 new home sales in October 2024, a 3.7% from the 54,000 new home sales in September.
By product type, conventional loans composed 60.8% of loan applications, FHA loans composed 28.7% of applications, and VA loans composed 10.1% of applications. The average loan size for new homes increased to $409,942 in October from $402,658 in September.
“The average loan size picked up to almost $410,000, the highest in the survey since August 2022,” Kan says. “However, the FHA share remains elevated at almost 29%, driven by a high share of first-time home buyers still active in this segment of the market.”
