According to the new Builder Applications Survey by the Mortgage Bankers Association, new home purchase applications declined in April, a year-over-year decrease of 4.3 percent. It is also a staggering 20 percent down from last month.
After the streak of increases from the previous months, numbers finally went down – the first time this 2017. Still, year-to-date comparison is at 3-percent above the same period from 2016.
Yes, the demand is there, but inventoryremains a problem. The April data for housing construction inclusive of permits, starts, and completions released by the US Department of Housing and Urban Development and the Commerce Department revealed a continued downward trend in housing availability. This is made worse by the rising costs in construction – labor, materials, etc. that slows down the pace of building.
- Conventional loans made up 68.5 percent of the overall loan applications for April
- FHA loans covered 17.7 percent of the share
- RHS/USDA loans composed 1.4 percent
- VA loans took 12.4 percent of the pie
- The average loan size for new units also declined to $326,284 in April from $328,192 last March
April’s seasonally-adjusted estimate decreased by 22.8 percent from the previous month’s pace of 670,000 units. The seasonally-adjusted estimate for April is at 50,000 new home sales, down by 19.4 percent compared to March’s 62,000 new sales.