Flip On Flipping The data analysis company CoreLogic says "flipping" is back. This fairly well-known…
The Mortgage Bankers Association (referred MBA) forecasted a substantial jump in new construction home sales in January. Based on the response to its Builder Application Survey (referred BAS), the MBA estimated that applications for purchases of newly constructed homes rose about 18% compared to the previous January, and were up 34% from December. This change was not adjusted to reflect any typical seasonal patterns.
But even still, based on the application volume (and some other market data), the MBA estimates sales during the month were at a seasonally adjusted annual rate of about 700,000 units. This would signify a marked gain of 26.4% from December’s pace of 554,000 units. On an unadjusted basis, the estimated change from December was 35%, rising from 40,000 to 54,000 new homes sold.
This reflects some of the other positive news on US job growth suggesting that our economic fundamentals are fairly strong right now. Based on the applications taken, we can estimate that new home sales were running at a pace of 700,000 on a seasonally adjusted annual basis, which would be the highest of such estimates in the survey, which began in 2013. The MBA says 71% of loan apps received during January were for conventional loans and 15% for other FHA products. USDA loans had a 1.2% share and VA loans accounted for about 11%. On average, the loan size of new homes decreased from $339,203 in December, to $338,918 in January. Which is still a lowball compared to the housing market of King County.
MBA’s Builder Application Survey tracks application volume from mortgage subsidiaries of home builders across the country. Utilizing this information, as well as data from other sources, MBA provides an early estimate of new home sales volumes at the national, state, and metro level as well as counts of the types of loans used by new home buyers. Official new home sales estimates are provided monthly by the Census Bureau. It records sales at contract signing, which is typically coincident with the mortgage application. Census Bureau data on new home sales in January will be published on February 26.
*This article does not represent legal interpretation or advice. This is not a commitment to make a loan. Loans are subject to borrower qualifications, including income, property evaluation, sufficient equity in the home to meet LTV requirements, and final credit approval. Approvals are subject to underwriting guidelines, interest rates, and program guidelines, and are subject to change without notice based on applicant’s eligibility and market conditions. Refinancing an existing loan may result in total finance charges being higher over life of loan. Reduction in payments may reflect longer loan term. Terms of the loan may be subject to payment of points and fees by the applicant. NMLS: LO# 305371 MB# 761615