New home sales see big jump

by MPA18 Feb 2014
January saw a big jump in the annual rate of new single-family homes, according to data released by the Mortgage Bankers Association.

The MBA estimated that new home sales were running at a seasonally adjusted rate of 543,000 units in January, up 35% from December’s pace of 402,000 units. On an unadjusted basis, the MBA estimated a total of 38,000 new home sales last month, an increase of 38% from December’s sales of 28,000 units.

“While the big jump may appear to conflict with other data, such as MBA’s purchase application index and NAR’s existing home sales data that point to a weak market for existing homes, our Builder Application Survey estimate is consistent with reports of homebuilder sentiment that show strength in the market for new homes,” said MBA Chief Economist Mike Fratantoni. “It is also worth noting that the significant January increase also followed a particularly slow pace of sales in November and December.”

Mortgage applications for new homes were also up, rising 27% in January from the previous month, the MBA reported. That number did not include an adjustment for typical seasonal patterns.

Conventional loans accounted for 69.4% of all loan applications, according to the MBA. Federal Housing Administration loans accounted for 15.9%, VA loans made up 13.4%, and USDA loans accounted for 1.3%. The average loan size for new homes was down to $289,358 in January from December’s $300,444.
 

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