Mortgage Applications For New Home Purchases Up 22.2% YoY, MBA Reports

The latest data from the Mortgage Bankers Association (MBA) Builder Application Survey (BAS) found an uptick in mortgage applications for new home purchases when comparing December 2023 to December 2022. 

“The low level of existing homes for sale continues to divert prospective buyers to newly built homes. Mortgage applications for new homes showed a 22% annual gain in December – the 11th consecutive year-over-year increase in applications,” MBA’s Deputy Chief Economist Joel Kan said. “Compared to November 2023, applications were down 4% on a non-seasonally adjusted basis, consistent with December declines for the past two years.”

In December 2023, MBA estimates that new single-family home sales ran at a seasonally adjusted annual rate of 599,000 units. However, this figure represents an 11.5% decrease from the November pace of 677,000 units when seasonally adjusted. On an unadjusted basis, MBA's estimate indicates 46,000 new home sales in December, reflecting a 6.1% decline from the 49,000 new home sales reported in November.

The composition of loans for new home purchases reveals that conventional loans accounted for 64.5% of all applications, while FHA loans comprised 25.1%. RHS/USDA loans comprised 0.5%, and VA loans constituted 9.9% of the total applications. The average loan size for new homes increased from $390,049 in November to $405,368 in December, suggesting that buyers are increasingly willing to invest in larger properties.

The BAS tracks application volume from mortgage subsidiaries of home builders nationwide.