Decrease in the number of applications for mortgages for the purchase of new housing in July

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IN Mortgage Bankers Association (MBA) Builder Application Survey (BAS) data for July 2021 shows that mortgage applications for new home purchases decreased by 27.4% compared to last year. Compared to June 2021, the number of applications decreased by 4%… This change does not include adjustments for typical seasonal patterns.

“The number of mortgage applications for new home purchases declined in July – which is typical of most summer seasons when home sales start to decline – but they ranked second in July since the MBA study began in 2012,” says Joel Kahn. MBA partner. Vice President for Economic and Industrial Forecasting ”. In addition, the average loan size increased again to a new record of $ 402,440. Builders continue to face high construction costs and accelerated housing price increases due to the continuing imbalance between supply and demand. After seasonally adjusted, our estimate of annual new home sales showed a jump of more than 10% from June. The housing market is still extremely competitive and potential buyers are increasingly turning to newly built homes because stocks for sale remain so low. ”

The MBA estimates that the seasonally adjusted sales of new single-family homes in July 2021 were 779,000 units per year based on BAS data. Estimates of new home sales are derived using BAS mortgage application information, market coverage assumptions and other factors.

The seasonally adjusted estimate for July is an increase of 10.7% over the June rate of 704,000 units. On an unadjusted basis, the MBA estimates that 64,000 new homes were sold in July 2021, down 3% from the 66,000 new home sales in June.

By product type, conventional loans accounted for 73.8% of loan applications, FHA loans accounted for 14.6%, RHS / USDA loans accounted for 0.8% and VA loans accounted for 10.8%. The average loan for new home construction increased from $ 392,370 in June to $ 402,440 in July.

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