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November New Home Purchase Mortgage Applications Decrease 11 Percent

November New Home Purchase Mortgage Applications Decrease 11 Percent

WASHINGTON, D.C. (December 13, 2018) – (RealEstateRama) — The Mortgage Bankers Association (MBA) Builder Application Survey (BAS) data for November 2018 shows mortgage applications for new home purchases decreased 11 percent from a year ago. Compared to October 2018, applications declined by 14 percent. This change does not include any adjustment for typical seasonal patterns.

“By our estimates, new home sales fell almost 7 percent in November, and were about 5 percent lower than a year ago,” said Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting. “Despite a still-strong job market and recent declines in mortgage rates, affordability challenges continue to hold back sales activity, as wage growth still lags behind home-price growth. Additionally, recent stock market volatility and some economic uncertainty likely also contributed to the pullback in home sales in November.”

MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 627,000 units in November, 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 November is a decrease of 6.8 percent from the October pace of 673,000 units. On an unadjusted basis, MBA estimates that there were 45,000 new home sales in November 2018, a decrease of 15.1 percent from 53,000 new home sales in October.

By product type, conventional loans composed 69.7 percent of loan applications, FHA loans composed 17.3 percent, RHS/USDA loans composed 0.7 percent and VA loans composed 12.3 percent. The average loan size of new homes decreased from $331,732 in October to $326,037 in November.

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.

CONTACT
Adam DeSanctis

(202) 557-2727

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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.

Contact:

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

Phone: (202) 557-2700