The Mortgage Bankers
Association's (MBA) estimate of new home sales rose in April. MBA bases its estimate on applications for
mortgages to purchase new homes as reported through its Builder Application
Survey (BAS) conducted among mortgage subsidiaries of home building
companies. The BAS, showed applications were
up 5 percent in April to a seasonally adjusted annual rate of 419,000 units
compared to 400,000 in March. March data
was downgraded from an original report of 479,000 units further widening the
gap between February and March sales from the -10.7 month-over-month decrease
originally reported. The applications data
is not adjusted to account for seasonal variations.
On an unadjusted basis
MBA estimates that there were 42,000 new home
sales in April 2014, an increase of 8 percent from 39,000 in March. That
March figure was also revised down substantially from the 46,000 sales
originally estimated 300for March.
Conventional loans made up 68.4 percent of loan
applications and FHA-backed loans accounted for 15.8 percent. VA loans composed 14.2 percent and 1.6
percent were Rural Housing Service (USDA) loans. The average size of a loan used to purchase a
new house increased to $299,094 in April from $296,428 the previous month.
In addition to data collected through the BAS MBA
uses assumptions regarding market coverage and other factors. MBA re-benchmarked the market coverage of its
survey this month to an estimate of over 30 percent of annual sales volume
based on information from the Census Bureau.
It was previously benchmarked at an estimate of just under 30 percent.
MBA uses its survey data to provide an early
estimate of new home sales volumes at the national, state, and metro level,
however official new home sales estimates are conducted by the Census Bureau on
a monthly basis.