US New-Home Purchase Mortgage Applications Fall in February

On Thursday, the Mortgage Bankers Association (MBA) reported that mortgage applications for new-home purchases fell 1% in February, according to data from its Builder Application Survey. Applications were up 0.9% year-over-year. Changes are not seasonally adjusted.

MBA estimates new single-family home sales were running at a seasonally adjusted annual rate (SAAR) of 641,000 units in February, a 3.3% decrease from the January pace of 663,000 units. On an unadjusted basis, MBA estimates that there were 57,000 sales in February, a 1.7% decrease from 58,000 in January.

By product type, conventional loans accounted for 49.4% of applications, FHA loans 35.3%, VA loans 14.1%, and RHS/USDA loans 1.2%. The average loan size decreased from $385,506 in January to $383,570 in February.

Commenting on the report, MBA Vice President and Deputy Chief Economist Joel Kan said:

“New home sales activity increased slightly in February compared to year-ago levels. More housing inventory has broadly supported some of the growth in homebuying patterns in recent months. However, even as lower mortgage rates provided some payment relief towards the end of the month, both applications for purchase loans and new home sales were lower than in January. Macroeconomic uncertainty likely played a role in this sluggishness, especially given the weakening job market. Additionally, with much of the available inventory in Sunbelt states, demand in many of those markets might be slowing, even with easing home-price growth.”