Mortgage applications for new home purchases were down two percent in August from July and down 4.6 percent from a year ago, according to new data from the Mortgage Bankers Association (MBA)
The MBA estimated new single-family home sales were at a seasonally adjusted annual rate of 669,000 units in August, which is five percent higher than the July pace of 637,000 units. On an unadjusted basis, MBA estimated 53,000 new home sales in August, unchanged from July. The average loan size of new homes decreased from $337,775 in July to $332,801 in August. Conventional loans accounted for 71.4 percent of loan applications last month, while FHA loans composed 15.6 percent, VA loans were an 11.8 percent share and RHS/USDA loans took up 1.2 percent of all activity.
"Our seasonally-adjusted estimate of new home sales increased five percent over the month, the second straight monthly increase," noted Joel Kan, MBA Associate Vice President of Economic and Industry Forecasting. "Low inventory of homes for sale has been an issue this year, and newly constructed units have been one way to ease the shortage. Growth in August was focused in the lower price tiers. In fact, for the first time in four months, monthly growth was driven by the lower half of the market, based on application size."