Applications for mortgages for new home sales increased 5% on an unadjusted basis in August compared with July and increased 14% compared with August 2015, according to the Mortgage Bankers Association’s (MBA) Builder Applications Survey.
About 67.7% of the applications for new homes in August were for conventional loans. About 18.4% were for loans backed by the Federal Housing Administration, while applications for Veterans Affairs loans were about 13.2% of all new home applications. About 0.7% of applications for new homes were for Rural Housing Service/U.S. Department of Agriculture loans.
The average loan size for a new home in August was about $325,224, down from $325,843 in July.
The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of about 601,000 units in August – an increase of 11.3% compared with the July pace of about 540,000 units.
On an unadjusted basis, the MBA estimates that there were about 48,000 new home sales in August – an increase of 6.7% compared with 45,000 in July.
“Based on the applications data, our estimate of seasonally adjusted new home sales for August reached 601,000 sales, the highest level observed in our survey since it began in 2012,” said Lynn Fisher, vice president of research and economics for the MBA, in a release. “While our new home sales estimates have trailed the recent U.S. Census data, the increase in our series in August, which derives from a different source of data compared to the Census, provides some corroboration that single-family building activity has remained strong, even as the summer winds down. Our sense is that builders have been attempting to catch up with demand in the face of labor shortfalls and other limiting factors in various parts of the country.”