WASHINGTON –Mortgage applications for new home purchases increased 8.2% in October compared from a year ago, the Mortgage Bankers Association (MBA) reported.
Compared to September 2024, applications increased by 3%.
“New home purchase activity picked up in October even as stronger economic data and election uncertainty pushed mortgage rates higher over the course of the month,” said Joel Kan, MBA’s vice president and deputy chief economist. “Both new applications and estimated home sales were higher compared to year-ago levels. New homes are an attractive alternative for many buyers as existing inventory is still tight in many markets around the country and a newly constructed home provides additional customization options. The average loan size picked up to almost $410,000, the highest in the survey since August 2022. However, the FHA share remains elevated at almost 29%, driven by a high share of first-time home buyers still active in this segment of the market.”
MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 747,000 units in October 2024.
The seasonally adjusted estimate for October is an increase of 9.9% from the September pace of 680,000 units. On an unadjusted basis, MBA estimates that there were 56,000 new home sales in October 2024, an increase of 3.7% from 54,000 new home sales in September.
By product type, conventional loans composed 60.8% of loan applications, FHA loans composed 28.7%, RHS/USDA loans composed 0.4% and VA loans composed 10.1%. The average loan size for new homes increased from $402,658 in September to $409,942 in October.