New Home Purchase Mortgage Applications Increased In April

The Mortgage Bankers Association (MBA) Builder Application Survey (BAS) data for April 2024 revealed that mortgage applications for new home purchases increased 22.1% compared to a year ago.

Compared to March 2024, applications increased by 2%. This change does not include any adjustment for typical seasonal patterns.

“New home purchase activity increased at a healthy pace in April 2024 after a slight pause in March. Applications to purchase newly constructed homes increased 22 percent over the year and have now shown annual gains for 15 consecutive months,” said MBA’s Vice President and Deputy Chief Economist, Joel Kan. “There continues to be [a] healthy demand for new homes, given greater availability and other benefits over existing home purchases such as builder concessions and customization options. First-time homebuyers account for a growing share of purchase applications with the FHA share of applications at 26.3 percent in April, higher than the survey average of 18 percent dating back to 2013. Our estimate of new home sales increased more than 13 percent to 699,000 units, the strongest pace in three months.”

MBA estimates new single-family home sales, which have consistently been a leading indicator of the U.S. Census Bureau’s New Residential Sales report, were running at a seasonally adjusted annual rate of 699,000 units in April 2024. 

The seasonally adjusted estimate for April is an increase of 13.7% from the March pace of 615,000 units.  On an unadjusted basis, MBA estimates that there were 62,000 new home sales in April 2024, an increase of 3.3% from 60,000 new home sales in March. 

By product type, conventional loans comprised 62.8% of loan applications, FHA loans comprised 26.3%, RHS/USDA loans comprised 0.3%, and VA loans comprised 10.5%. The average loan size for new homes increased from $405,400 in March to $405,490 in April.