New Home Mortgage Applications Softened in August

The Mortgage Bankers Association’s (MBA’s)rnmeasure of new home sales reflected a significant drop in the volume of applicationsrnfor mortgages to purchase those homes in August.  Data gathered through MBA’s Builder Applications Survey (BAS) indicates that thernnumber of applications decreased by 9 percent relative to the volume inrnJuly.  Thernmeasure is not adjusted to account for typical seasonal patterns.</p

Based on the BAS and assumptionsrnregarding market coverage and other factors MBA estimates that new single-familyrnhome sales in August were at a seasonally adjusted annual rate of 424,000 units.  This is a change of -2.1 percent from thernestimate for July of 433,000 units.  On arnnon-adjusted basis sales in August were estimated to be approximately 34,000,rndown from 37,000 units the previous month, a decrease of 8.1 percent.  Estimated August sales were 2.9 percent belowrnsales in August 2013 of 35,000 units. <br /<br /MBA's monthly report breaks down new home purchase applications by product type.  Conventional loans made up 68.9 percent ofrnloan applications and FHA loans 15.7 percent. rnVA loans were the third largest source at 14.3 percent and 1.0 percentrnwere RHS/USDA loans.  The average loanrnsize to purchase new homes increased from $297,253 in July to $300,443 inrnAugust.<br /<br /MBA's Builder Application Survey tracks application volume from mortgagernsubsidiaries of home builders across the country.  Official new home salesrnestimates are conducted by the Census Bureau on a monthly basis.  In thatrndata, new home sales are recorded at contract signing, which is typicallyrncoincident with the mortgage application.  

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