Mortgage Apps for New Homes Drop by 11 Percent in December

MBA’s Builder Application Survey data for December 2013 shows that mortgage applications for new home purchases decreased by 11 percent relative to the previous month. This change does not include any adjustment for typical seasonal patterns. By product type, conventional loans composed 63 percent of loan applications, FHA loans composed 19.2 percent, RHS/USDA loans composed 0.9 percent and VA loans composed 16.9 percent. The average loan size of new homes increased from $295,523 in November to $300,444 in December. Utilizing information from the BAS, as well as assumptions regarding market coverage and other factors, MBA estimates that sales of new single-family homes were running at a seasonally adjusted annual rate of 402,000 in December 2013. On an unadjusted basis, the MBA estimates that there were 28,000 new home sales in December 2013. New home sales for the full year for 2013 averaged 445,000 homes according to MBA’s BAS, aligning with the MBA’s Mortgage Finance Forecast of new home sales for 2013 of 449,000.