Mortgage Applications for New Home Purchases Decline Month-Over-Month but Rise Year-Over-Year in June

The Mortgage Bankers Association (MBA) is reporting that data from its June Builder Application Survey reveals that mortgage applications for new home purchases declined 5.0% month-over-month but were up 26.1% year-over-year. This does not include any adjustments for typical seasonal patterns.

According to the MBA, the seasonally adjusted estimate for June decreased 9.0% from May’s pace of 755,000 units. On an unadjusted basis, the MBA estimates that there were 60,000 new home sales in June, a decrease of 6.3% from 64,000 new home sales reported in May.

Adding additional background and analysis to the report, MBA’s Vice President and Deputy Chief Economist Joel Kan said:

“New home purchase activity continues to be a bright spot, as both new home applications and home sales were up on an annual basis. With existing inventory still held back by homeowners, prospective buyers have turned to newly built homes instead. Rising mortgage rates in June likely caused some pullback in purchases over the month, as the 30-year fixed rate averaged close to 6.8 percent. However, applications for new home purchases have now shown annual increases for five consecutive months.”