Increase in new home purchase applications – a good sign

Read next: Originators – don’t panic

An estimated 821,000 new single-family homes were sold last month, down 7.4% from the December pace of 887,000 units. On an unadjusted basis, there were 66,000 new home sales in January, a sequential increase of 10% from 60,000 new home sales the previous month.

“MBA’s estimate of new home sales fell in January to its slowest annual pace since July 2021,” Kan said. “Purchase activity for new homes continues to be concentrated in the higher end of the market, and overall sales prices continue to increase, as evidenced by another record-setting month for the average loan size at $427,000.”

By product type, conventional loans composed 77% of loan applications, FHA loans composed 13%, RHS/USDA loans composed 0.5% and VA loans composed 9.5%. The average loan size of new homes increased from $423,102 in December to $426,954 in January.