Lumber Market News Mortgage applications for new home purchases decline in June End Use
Posted on July 18, 2024
On Thursday, the Mortgage Bankers Association (MBA) said data from the Builders Applications Survey (BAS) showed that mortgage applications for new home purchases fell 16.0% in June from the previous month but increased 0.7% from a year ago. This change does not include adjustments for typical seasonal patterns.
The MBA estimates that new single-family home sales in June were a seasonally adjusted annual rate of 626,000, down 10.8% from May. On an unadjusted basis, the MBA estimates that new home sales in June were 52,000, down 17.5% from May.
By type of loan product, conventional loans accounted for 60.8% of loan applications, FHA loans 28.7%, RHS/USDA loans 0.3%, and VA loans 10.2%. The average loan amount for new construction homes decreased from $400,150 in May to $399,879 in June.
Commenting on the June BAS results, MBA Vice Dean and Associate Chief Economist Joel Kang said:
“Applications for new home purchases slowed in June, consistent with overall declines in single-family home construction and new building permits, as well as typical seasonal patterns. Average loan amounts decreased for the second consecutive month, and the share of FHA applications increased to 28.7%, as first-time buyers continue to make up a growing share of demand for new homes.”
The MBA's new home sales forecast sees monthly sales falling to 626,000, the slowest pace in four months. Mortgage rates fell below 7 percent in June, but that did little to spur buying activity.”
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