“Applications to purchase new homes in November slightly declined on a monthly and annual basis,” MBA Associate Vice President of Economic and Industry Forecasting Joel Kan said in a release. “However, the average loan amount increased to a new record of $414,114. A competitive purchase market, combined with increased building materials costs, have been pushing sales prices higher. There also continues to be a shift to the higher end of the market, which is also contributing to the higher loan amounts.
“New home sales had a strong month with more homebuyers choosing newly built homes,” Kan added. “Home sales edged higher over the month to the strongest annual pace since January 2021 at 905,000 units, as limited for-sale inventory has driven more demand to the new home segment. MBA’s November estimate for new home sales is the largest for the month since the survey began in 2012.”
According to the BAS, new single-family home sales ran at a seasonally adjusted annual rate of 905,000 units in November 2021, compared with the October pace of 897,000 units (a 0.9 percent increase). On an unadjusted basis, the association estimated 65,000 new home sales in November, compared with 68,000 the month before (a 4.4 percent decrease).
When broken down by product type, conventional loans composed 76.3 percent of loan applications, Federal Housing Administration loans accounted for 13.2 percent, Department of Veterans Affairs composed 10 percent, and Rural Housing Service/United States Department of Agriculture accounted for 0.5 percent. The average loan size increased from $412,339 in October to $414,114 in November.