In another indication that the purchase money mortgage market may be strengthening, the Mortgage Bankers Association reported applications for new home purchases rose by almost one third from September 2014 to September 2015.
"Positive momentum in mortgage applications to homebuilder affiliates lead us to estimate that new home sales were up 29% in September compared to a year ago," MBA Vice President of Research and Economics Lynn Fisher said. "It also suggests that housing starts will continue to post relatively strong numbers through the end of the year."
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MBA reported conventional loans composed 67.7% of loan applications, FHA loans 19.2%, RHS/USDA loans 0.9% and VA loans 12.2%. The average loan size of new home mortgages increased from $317,035 in August 2015 to $324,884 in September 2015.
MBA drew the data from its Builder Application Survey, which it used to track application volume from mortgage subsidiaries of home builders across the country. MBA uses this data along with other information to provide an early estimate of new home sales volumes at the national, state and metro levels, the association said.
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