The Mortgage Bankers Association reports that mortgage applications for new home purchases increased 14.9 percent compared to one year ago. Compared to August 2023, applications decreased by 12 percent.
The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 634,000 units last month. That estimate is a decrease of 9.7 percent from the August pace of 702,000 units.
“New home purchase activity weakened in September, as the recent spike in mortgage rates pushed more homebuyers out of the market,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Applications for new home purchases decreased over the month but were 15 percent higher than a year ago, which is the eighth consecutive month of annual gains. Demand for newly constructed homes remains relatively strong due to the persistent shortage of resale inventory, but increasing mortgage rates are impacting would-be buyers. MBA’s estimate of new home sales dropped to a 634,000-unit pace, the weakest sales pace since October 2022.
“The FHA share of applications reached 25 percent in September, the highest share in the survey dating back to 2013,” added Kan. “This is an indication that demand from first-time homebuyers is still somewhat strong.”