Applications for new home purchases increased 17% on an unadjusted basis in March compared with February, according to the Mortgage Bankers Association’s (MBA) Builder Application Survey (BAS).
“Rising prices for existing homes and a strong job market are making the math work for new construction,” says Lynn Fisher, vice president of research and economics for the MBA, in a statement. “In March, the [survey] reached its highest level since its inception in 2012 and was more than 18 percent higher than one year ago. During the last three years, peak application activity for new homes has taken place in March and April, suggesting the trend should continue next month.”
By product type, conventional loans represented about 67.5% of all loan applications for new homes in March.
Applications for new homes backed by the Federal Housing Administration represented about 18.7%, while applications for new homes backed by the Rural Housing Service/U.S. Department of Agriculture represented about 0.7%. Applications for Veterans Affairs loans represented about 13.0%.
In March, the average loan size for a new home was about $339,296, up from $328,370 in February.
The MBA estimates that new single-family home sales were running at a seasonally adjusted annual rate of about 574,000 units in March. That’s an increase of 5.5% compared with the February pace of about 544,000 units.
On an unadjusted basis, the MBA estimates that there were 54,000 new home sales in March – an increase of 14.9% compared with about 47,000 in February.