MBA: New home purchases soared in January
Estimate surpassed expectations
Even though new home purchases dropped 6% in December, for the month of January the Mortgage Bankers Association’s Builder Application Survey shows mortgage applications for new home purchases, increased by 14%.
MBA’s Builder Application Survey tracks application volume from mortgage subsidiaries of home builders across the country. This change does not include any adjustment for typical seasonal patterns.
Per the report, by product type, conventional loans composed 67.4% of loan applications, Federal Housing Administration loans composed 19.5%, RHS/USDA loans composed 0.7% and VA loans composed 12.4%. The average loan size of new homes decreased from $333,182 in December to $325,806 in January.
Based from the BAS data, the MBA estimates new single-family home sales ran at a ‘seasonally adjusted annual rate’ of 499,000 unites in January 2016.
The seasonally adjusted estimate for January is an increase of 4% from the December pace of 480,000 units. On an unadjusted basis, the MBA estimates that there were 38,000 new home sales in January 2016, an increase of 11.8% from 34,000 new home sales in December.