March New Home Purchase Mortgage Applications Decreased 2.6 Percent Year over Year
|(202) 557- 2727|
WASHINGTON, D.C. (March 15, 2018) - The Mortgage Bankers Association (MBA) Builder Application Survey (BAS) data for March 2018 shows mortgage applications for new home purchases decreased 2.6 percent compared to March 2017. Compared to February 2018, applications increased by 14 percent. This change does not include any adjustment for typical seasonal patterns.
"Applications taken for new home purchases decreased year over year in March. We saw a strong January and February, and that may have pulled some activity forward. We did, however, see the third straight month over month increase, which is in line with the typical seasonal pattern at this time of the year," said Joel Kan, Associate Vice President of Economic and Industry Forecasting. "Our estimate of new home sales for March was 682,000 units, a rebound of almost 8 percent after a February decrease."
By product type, conventional loans composed 71.2 percent of loan applications, FHA loans composed 15.4 percent, RHS/USDA loans composed 1.4 percent and VA loans composed 11.9 percent. The average loan size of new homes decreased from $338,078 in February to $337,597 in March.
The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 682,000 units in March 2018, 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 March is an increase of 7.9 percent from the February pace of 632,000 units. On an unadjusted basis, the MBA estimates that there were 65,000 new home sales in March 2018, an increase of 18.2 percent from 55,000 new home sales in February.
MBA's Builder Application 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.
For additional information on MBA's Builder Applications Survey, please click here.