MBA : December new home purchase mortgage applications increase 2 pct y-o-y in the U.S
The Mortgage Bankers Association (MBA) Builder Applications Survey (BAS) data for December 2016 shows mortgage applications for new home purchases increased 2 percent relative to December 2015. Compared to November 2016, applications decreased by 14 percent relative to the previous month. This change does not include any adjustment for typical seasonal patterns.
“Mortgage applications for new single family homes increased on a year over year basis in every month of 2016, with December displaying the thinnest margin over 2015,” said Lynn Fisher, MBA’s Vice President of Research and Economics. “However, growth in applications set a high benchmark in December 2015, and it is not yet clear if the recent rise in interest rates is having an impact on applications for new homes. Looking forward to 2017, MBA continues to forecast more than 10 percent growth in single family housing starts.”
By product type, conventional loans composed 67.5 percent of loan applications, FHA loans composed 18.5 percent, RHS/USDA loans composed 0.9 percent and VA loans composed 13.1 percent. The average loan size of new homes increased from $329,389 in November to $331,354 in December.
The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 478,000 units in December 2016, based on data from the BAS. The new home sales estimate is derived using mortgage application information from the BAS, as well as assumptions regarding market coverage and other factors.
The seasonally adjusted estimate for December is a decrease of 18.7 percent from the November pace of 588,000 units. On an unadjusted basis, the MBA estimates that there were 35,000 new home sales in December 2016, a decrease of 14.6 percent from 41,000 new home sales in November.
MBA’s Builder Applications Survey tracks application volume from mortgage subsidiaries of home builders across the country. Utilizing this data, as well as data from other sources, MBA is able to provide an early estimate of new home sales volumes at the national, state, and metro level. This data also provides information regarding the types of loans used by new home buyers. Official new home sales estimates are conducted by the Census Bureau on a monthly basis. In that data, new home sales are recorded at contract signing, which is typically coincident with the mortgage application.