New Home Mortgage Applications in U.S. Spike 16.1 Percent Year Over Year

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According to the Mortgage Bankers Association's Builder Application Survey for October 2017, mortgage applications for new home purchases in the U.S. increased 16.1 percent compared to October 2016. Compared to September 2017, applications increased by 23 percent relative to the previous month. This change does not include any adjustment for typical seasonal patterns.

"October registered the strongest growth rate in applications so far this year, following September's hurricane related decrease," said Lynn Fisher, MBA's Vice President of Research and Economics. "Overall, applications reached near August levels. Texas mirrored the national pattern, and Florida fell just 4 percent short of its August total. The Builder Application Survey does not measure activity in Puerto Rico."

By product type, conventional loans composed 71.8 percent of loan applications, FHA loans composed 15.1 percent, RHS/USDA loans composed 1.4 percent and VA loans composed 11.7 percent. The average loan size of new homes increased from $334,722 in September to $339,534 in October.

The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 659,000 units in October 2017, based on data from the BAS. 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 October is an increase of 15.4 percent from the September pace of 571,000 units. On an unadjusted basis, the MBA estimates that there were 53,000 new home sales in October 2017, an increase of 26.2 percent from 42,000 new home sales in September 2017.