New Home Purchase Applications in U.S. Uptick in January

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According to the Mortgage Bankers Association's Builder Application Survey for January 2015, mortgage applications for new home purchases increased by 29 percent relative to the previous month. This change does not include any adjustment for typical seasonal patterns.

"On the strength of an improving labor market and low interest rates, January new home sales were up nearly 30 percent from December, " said Lynn Fisher, MBA's Vice President of Research and Economics. "Relative to a year ago, new home sales were up 2.6 percent on an unadjusted basis."

By product type, conventional loans composed 67.2 percent of loan applications, FHA loans composed 18.2 percent, RHS/USDA loans composed 1.1 percent and VA loans composed 13.4 percent. The average loan size of new homes decreased from $311,398 in December to $304,364 in January.

The MBA estimates new single-family home sales were running at a seasonally adjusted annual rate of 530,000 units in January 2015, based on data from the BAS. The new home sales estimate is derived using mortgage application information from the BAS, as well as assumptions regarding market coverage and other factors.

The seasonally adjusted estimate for January is an increase of 29.6 percent from the December pace of 409,000 units. On an unadjusted basis, the MBA estimates that there were 39,000 new home sales in January 2015, an increase of 39.3 percent from 28,000 new home sales in December.