New home sales fell by 11.5% to 468,000 annualized units in September – a far greater drop than the expected 0.4% decline.
Inventory of unsold homes, meanwhile, shot-up 4.2% to 225,000 in September from 216,000 in August.
The data may come as a surprise to mortgage brokers, many expecting an influx of sales just prior to the TRID implementation.
However, many reported a greater than average number of applications near the end of September, meaning October’s sales figures may benefit from that business boom.
“We got a lot of calls and I’ve spoken to others in town who experienced the same thing,” Scott Palmer, an originator with Colorado Professionals Mortgage, told Mortgage Professional America earlier this month. “There was enough information out there and people knew transactions would start taking longer after October 3.”
According to the Mortgage Bankers Association’s most recent data, applications were up 11.8% week-over-week for the seven days ending October 16.
However, application levels for the next few weeks will be hard to predict, according to the MBA.
"On an adjusted basis, application volume increased last week, led by a sharp rebound in government volume,” Mike Fratantoni, MBA's chief economist, said in a release. “We expect that application volume will remain volatile over the next few weeks as the industry continues to implement TILA-RESPA integrated disclosures"
The expected rush of originations in the ramp-up to TRID implementation failed to materialize, according to recently released stats.