Mortgage applications for new home purchases rose slightly in June compared to the previous month, driven by a continued recovery in home prices, according to the Mortgage Bankers Association (MBA).

Applications for new home purchases increased by 1% in June relative to the previous month, reports the MBA’s Builder Application Survey data. While the monthly increase appears minimal, the activity in June was higher compared to recent years, said Lynn Fisher, MBA’s vice president of research and economics.

“As house prices continue to recover, mortgage applications for the purchase of newly constructed homes increased slightly in June,” Fisher said in a written statement. “Application activity in June was slightly higher compared to the past two years, leading us to estimate that new home sales increased 8 percent from May on a seasonally adjusted annual basis.”

MBA’s Builder Application Survey (BAS) tracks application volume from mortgage subsidiaries of home builders nationwide. Using this data, along with data from other sources, MBA is able to provide an early estimate of new home sales volume at the national, state and metro level.

By product type, conventional loans accounted for 67.2% of loan applications, while Federal Housing Administration loans represented 19.6%, RHS/USDA loans comprised 1% and VA loans 12.2%.

The average loan size of new homes increased from $320,744 in May to $321,678 in June.

MBA estimates that new single-family home sales were running at a seasonally adjusted annual rate of 496,000 units in June, based on data from the BAS. This sales estimate is derived using mortgage app information from the BAS as well as assumptions regarding market coverage and other factors, MBA stated.

The seasonally adjusted estimate for June is a growth of 8.1% from the May pace of 459,000 units. On an unadjusted basis, MBA estimates that there were 45,000 new home sales in June 2015, which it notes as being unchanged from May.

Written by Jason Oliva