Applications for mortgages for new home purchases increased 6% in February compared with January and were up 3% compared with February 2018, according to the Mortgage Bankers Association’s (MBA) Builder Application Survey (BAS).
“The housing market remains poised for a strong spring, with last month’s increase in builder applications likely leading to a healthy seven percent year-over-year rise in new home sales,” says Joel Kan, associate vice president of economic and industry forecasting for the MBA, in a statement. “We are starting to see signs of more new residential construction and inventory, which increases buying opportunities for the many home shoppers who have been hampered by the ongoing lack of supply.”
Kan adds that “slowing home-price growth, combined with stronger wage gains and lower mortgage rates, is translating to improving affordability conditions for spring buyers.”
New single-family home sales were running at a seasonally adjusted annual rate of about 690,000 units in February, the MBA estimates based on data from the BAS. That’s a decrease of 3.2% compared with the January pace of 713,000 units.
On an unadjusted basis, the MBA estimates there were 59,000 new home sales in February, an increase of 9.3% from 54,000 new home sales in January.
Last week, the U.S. Census Bureau and U.S. Department of Housing and Urban Development reported that new home sales in December had reached an annual rate of 621,000, an increase of 3.7% compared with November but down 2.4% compared with December 2017.