MBA says New Home Sales up while Mortgage Applications Drop

Applications for new home purchase mortgages declined in June for the second month in a row the Mortgage Bankers Association (MBA) said today.  Its Builder Application Survey (BAS), taken among mortgage subsidiaries of builders throughout the US, showed that 5 percent fewer applications were made during June than in May.  There was an estimated 8 percent decline from April to May.   

Based on the application data from the survey and assumptions regarding market coverage and other factors MBA estimates that new home sales during the month were 3.2 percent higher on a seasonally adjusted basis, running at an annual rate of 386,000 units compared to 374,000 units in May.   On an unadjusted basis June sales are estimated at 38,000 units, unchanged from May.

By product type, conventional loans made up 67.2 percent of loan applications and FHA loans 17.0 percent.  VA loans had a 14.6 percent share and 1.2 percent were loans from the Rural Housing Service/USDA.  The average loan size to purchase a new home was $296,078, slightly less than the average of $296,427 in May.   

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.