July New Home Purchase Mortgage Applications Increased 5.1 Percent Year over Year

WASHINGTON, D.C. (August 11, 2017) – (RealEstateRama) — The Mortgage Bankers Association (MBA) Builder Applications Survey (BAS) data for July 2017 shows mortgage applications for new home purchases increased 5.1 percent compared to July 2016. Compared to June 2017, applications decreased by 12 percent. This change does not include any adjustment for typical seasonal patterns.

“The year over year increase in applications to homebuilders for new home purchase mortgages slowed down somewhat in July, after relatively strong showings in May and June,” said Lynn Fisher, MBA’s Vice President of Research and Economics. “Nonetheless, the pattern of applications over the last three months suggests that housing starts will fall off less than expected during late summer and early fall as demand spills over from the low-inventory existing home market into the market for new homes. Year to date, through July, applications for new homes remain up by more than 7 percent compared to the same period last year.”

By product type, conventional loans composed 69.8 percent of loan applications, FHA loans composed 15.7 percent, RHS/USDA loans composed 1.1 percent and VA loans composed 13.3 percent. The average loan size of new homes increased from $327,833 in June to $329,483 in July.

The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 562,000 units in July 2017, based on data from the BAS. The new home sales estimate is derived using mortgage application information from the BAS, as well as assumptions regarding market coverage and other factors.

The seasonally adjusted estimate for July is a decrease of 10.5 percent from the June pace of 628,000 units. On an unadjusted basis, the MBA estimates that there were 49,000 new home sales in July 2017, a decrease of 10.9 percent from 55,000 new home sales in June.

MBA’s Builder Application Survey tracks application volume from mortgage subsidiaries of home builders across the country. Utilizing this data, as well as data from other sources, MBA is able to provide an early estimate of new home sales volumes at the national, state, and metro level. This data also provides information regarding the types of loans used by new home buyers. Official new home sales estimates are conducted by the Census Bureau on a monthly basis. In that data, new home sales are recorded at contract signing, which is typically coincident with the mortgage application.

For additional information on MBA’s Builder Applications Survey, please click here.

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Ali Ahmad

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The Mortgage Bankers Association (MBA) is the national association representing the real estate finance industry, an industry that employs more than 280,000 people in virtually every community in the country. Headquartered in Washington, D.C., the association works to ensure the continued strength of the nation’s residential and commercial real estate markets; to expand homeownership and extend access to affordable housing to all Americans. MBA promotes fair and ethical lending practices and fosters professional excellence among real estate finance employees through a wide range of educational programs and a variety of publications. Its membership of over 2,400 companies includes all elements of real estate finance: mortgage companies, mortgage brokers, commercial banks, thrifts, Wall Street conduits, life insurance companies and others in the mortgage lending field.

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Mortgage Bankers Association
1331 L Street, NW
Washington, DC 20005

Phone: (202) 557-2700

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