Mortgage applications for new home purchases dropped 4.3% for April 2017 compared to April 2016, according to the latest Mortgage Bankers Association (MBA) Builder Applications Survey (BAS). April applications saw a massive decrease of 20% from March 2017.
The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 517,000 units in April 2017.
There was a 22.8% decrease in the seasonally adjusted estimate for April from the March pace of 670,000 units. On an unadjusted basis, there were 50,000 new home sales in April 2017, a drop of 19.4% from 62,000 new home sales in March.
Conventional mortgages made up the largest share of new home purchases with 68.5% of loan applications. FHA loans came in second were at 17.7% of total loan apps and VA loans came in third with 12.4% and RHS/USDA loans composed 1.4%.
The average loan size of new homes decreased from $328,192 in March to $326,284 in April, according to the MBA.
Lynn Fisher, MBA’s Vice President of Research and Economics. ”
“For the first time this year, mortgage applications for new homes in April were lower than the same month a year ago. Mortgage applications for new homes fell more than 20 percent in April after peaking in March, as they have the past 2 years.
A relatively strong March may have pulled forward some applications from April, exacerbating the normal seasonal fall-off. On net, year to date applications for new homes are running about 3 percent above the same period from 2016. Despite steady demand for housing, homebuilders continue to face rising costs for labor and materials which will continue to moderate the pace of building.”