Mortgage applications for new home purchases increased 23 percent in March and increased 6.7 percent compared to March 2016, according to the Mortgage Bankers Association (MBA) Builder Application Survey (BAS).
The Builder Application Survey Index reached its highest point since the series began tracking data in August 2012.
“The pick up from a fairly modest February showing suggests that developers are finding ways to bring new product on line to help supplement otherwise low inventories of existing homes for sale in the US,” Lynn Fisher, MBA’s vice president of research and economics, said.
Conventional loans composed 67.5 percent of loan applications in March, while FHA loans composed 18.6 percent, RHS/USDA loans composed 1.0 percent and VA loans composed 12.8 percent. The average loan size of new homes decreased from $330,208 in February to $328,192 in March, but is unchanged from March 2016.
Nearly two-thirds of applications for new homes in the survey have loan sizes between $200,000 and $400,000, Fisher said.
The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 670,000 units in March 2017, based on BAS data – up 14.3 percent from February. The new home sales estimate is derived using mortgage application information from the BAS, as well as assumptions regarding market coverage and other factors.