June New Home Purchase Mortgage Applications Increased 0.7 Percent

WASHINGTON, D.C. (July 18, 2024) – The Mortgage Bankers Association (MBA) Builder Application Survey (BAS) data for June 2024 shows mortgage applications for new home purchases increased 0.7 percent compared from a year ago. Compared to May 2024, applications decreased by 16 percent. This change does not include any adjustment for typical seasonal patterns.

“Applications for new home purchases slowed in June, consistent with broader declines in single-family construction and new building permits as well as typical seasonal patterns,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “The average loan size edged lower for the second consecutive month, and the share of FHA applications increased to 28.7 percent, as first-time buyers continue to account for a growing share of demand for newly built homes.”

Added Kan, “MBA’s estimate of new home sales showed a monthly decline to a pace of 626,000 units – the slowest in four months. Mortgage rates dipped below 7 percent in June but that did little to spur purchase activity.” 

MBA estimates new single-family home sales, which has consistently been a leading indicator of the U.S. Census Bureau’s New Residential Sales report, is that new single-family home sales were running at a seasonally adjusted annual rate of 626,000 units in June 2024. The new home sales estimate is derived using mortgage application information from the BAS, as well as assumptions regarding market coverage and other factors. 

The seasonally adjusted estimate for June is a decrease of 10.8 percent from the May pace of 702,000 units. On an unadjusted basis, MBA estimates that there were 52,000 new home sales in June 2024, a decrease of 17.5 percent from 63,000 new home sales in May. 

By product type, conventional loans composed 60.8 percent of loan applications, FHA loans composed 28.7 percent, RHS/USDA loans composed 0.3 percent and VA loans composed 10.2 percent. The average loan size for new homes decreased from $400,150 in May to $399,879 in June.

MBA’s Builder Application Survey tracks application volume from mortgage subsidiaries of home builders across the country. Utilizing this data, as well as data from other sources, MBA is able to provide an early estimate of new home sales volumes at the national, state, and metro level. This data also provides information regarding the types of loans used by new home buyers. Official new home sales estimates are conducted by the Census Bureau on a monthly basis. In that data, new home sales are recorded at contract signing, which is typically coincident with the mortgage application.  

For additional information on MBA’s Builder Application Survey, please click here.