Mortgage applications for new home purchases increased 4.4% in August compared to a year ago, according to the Mortgage Bankers Association (MBA). The MBA’s Builder Application Survey (BAS) indicates mortgage activity for new homes has posted annual increases for 19 consecutive months.
“Home buyers, including a growing share of first-time buyers, continue to favor newly built homes, as declining mortgage rates in August contributed to the uptick in new home sales activity,” MBA vice president and deputy chief economist Joel Kan says.
“The FHA share of purchase applications reached another record high in the survey at 29.6%,” Kan continues. “Estimated new home sales increased almost 15% over the month, reaching the fastest sales pace since February 2022.”
The MBA estimates new single-family home sales ran at a seasonally adjusted annual rate of 776,000 in August, up from July’s pace of 677,000 units. On an unadjusted basis, the MBA estimates there were 60,000 new home sales in August, an increase of 5.3% compared to 57,000 new home sales in July.
Conventional loans accounted for 59.7% of loan applications in August, while VA loans composed 10.2% of August loan applications. The average loan size for new homes increased to $395,935 in August from $393,344 in July.
