Mortgage Applications for New Home Purchases Declined -16.2% Year-Over-Year in September

The Mortgage Bankers Association (MBA) announced today (10-19-21) the results of their Builder Application Survey (BAS) data for September 2021. The BAS reveals that mortgage applications for new home purchases declined -16.2% compared to September 2020. When compared to August 2021, applications decreased by -4%. This change does not include any adjustments for typical seasonal patterns.

In a statement prepared for the release of the September BAS, Joel Kan, MBA’s Associate Vice President of Economic and Industry Forecasting said, “New home sales purchase activity was weaker in September, and the average loan size rose to another record high, as homebuilders continue to grapple with rising building materials costs and labor shortages. The survey-high average loan size of $408,522 is evidence of higher sales prices from these higher costs, as well as the shift in new construction to larger, more expensive homes.”

Kan added, “The estimated pace of new home sales decreased 3.5% last month after a strong August reading, but the two-month sales pace is at its strongest since January 2021.”