February Data Indicates Continued Gains in New Home Sales

Builder application data from February suggests another increase in new home sales, the Mortgage Bankers Association (MBA) reported Thursday.

According to MBA’s Builder Applications Survey (BAS), which tracks application volume from mortgage subsidiaries of homebuilders, applications for new home purchases increased 12 percent in February, pointing to a seasonally adjusted annual sales rate of 533,000 (up 1 percent from January).

On an unadjusted basis, the association estimates there were 43,000 new home sales in February, up 13 percent from the prior month.

While MBA overshot the mark with its initial January estimate of 543,000 new home sales, its prediction of a spike was correct: The Census Bureau estimates sales in January ran at a seasonally adjusted rate of 468,000, a monthly increase of 9.6 percent.

By product type, MBA reports conventional loans made up 65.1 percent of February applications. Loans backed by the Federal Housing Administration (FHA) composed 16.5 percent; loans backed by the Department of Veterans Affairs accounted for 13 percent; and rural loans composed 5.3 percent.

The average loan size of new homes was up, meanwhile, rising more than $5,000 to $295,008.