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New home purchase mortgage applications drop in July, MBA data shows
MBA estimated new single-family home sales at a 647,000 annual pace in July, down from 667,000 in June, as higher mortgage rates made buyers more rate-sensitive.
HousingWire reports that mortgage applications for new home purchases fell 5.7% in July from a year earlier, according to the Mortgage Bankers Association (MBA) Builder Application Survey. The survey also showed applications were down 1% from June.
MBA estimated new home sales at a seasonally adjusted annual rate of 647,000 units in July, down 3% from 667,000 in June. The July pace also came in below the 664,000-unit average recorded during the first six months of the year, marking the third decline in the annualized sales pace in four months.
In a statement, MBA vice president and deputy chief economist Joel Kan said purchase activity for newly built homes slowed in July, with both applications to purchase and estimated new home sales coming in behind last year’s pace. Kan pointed to elevated new home inventory and higher mortgage rates, which he said likely contributed to weaker demand as buyers became more rate-sensitive.
The report said MBA estimated 54,000 new home sales on an unadjusted basis in July, down 3.6% from 56,000 in June. It also noted that the average loan size for a new home fell to $374,438 in July from $375,218 in June, and described the loan mix for applications, including conventional, FHA, VA, and USDA shares.