Home buyers using a mortgage to purchase a new home in October had increased 8% when compared to October 2015. However, there was a small decrease from 2% in September, according to the latest survey by the Mortgage Banker’s Association.
Conventional mortgages had the largest share of loan applications in October with 67.7%, followed by FHA loans at 18.4%, VA loan share was at 12.9%, and the RHS/USDA loans composed 1.0%. The average loan size was up from $326,998 in September to $329,634 in October.
The seasonally adjusted annual rate of new single-family home sales was 547,000 units in October 2016. A drop of 7.8% from the September pace of 593,000 units. On an unadjusted basis, the MBA estimates that there were 44,000 new home sales in October 2016, unchanged from September.
Lynn Fisher, MBA’s Vice President of Research and Economics had said;
“Mortgage applications for new homes are down 2.3 percent over the month but are up 8.3 percent compared to last year. Year to date, the market share of builder applications has grown for conventional loans from 67.1 percent last year to 67.9 percent in 2016 and VA loans which increased from 12.5 percent last year to 13.1 percent in 2016. The share of mortgage applications for new homes fell for FHA and RHS loans to 18.3 percent and 0.7 percent respectively.”