Applications for new home purchases continued to climb in April, though at a substantially slower pace compared to the last few months.
The Mortgage Bankers Association [1] (MBA) reported Monday a 5 percent month-over-month increase in new home purchase applications. The increase is the lowest so far this year, following gains of 15 percent in March, 12 percent in February, and 27 percent in January.
Based on application volumes and other market considerations in MBA’s monthly Builder Applications Survey [2] (BAS), the group estimates new single-family sales ran at a seasonally adjusted yearly pace of 419,000 last month, a pickup of 5 percent over March’s revised pace of 400,000 units.
March’s annual pace, originally estimated at 479,000, partly as a result of rebenchmarking, MBA says. The revision brings estimated sales closer in line with Census estimates [3], which put new sales at a rate of 384,000 in March—a monthly decline of 14.5 percent.
On an unadjusted basis, MBA estimates there were 42,000 new home sales last month, an increase of 8 percent over the prior period.
The average loan size of new homes was also up, increasing more than $3,000 to $299,904.
By product type, the association reports conventional loans accounted for 68.4 percent of April new purchase applications, while Federal Housing Administration (FHA)-insured loans made up 15.8 percent. Meanwhile, mortgages insured by the Department of Veterans Affairs (VA) and Rural Housing Services/U.S. Department of Agriculture composed 14.2 percent and 1.6 percent of April applications, respectively.