The Mortgage Bankers Association (MBA) Builder Applications Survey (BAS) data for July 2018 shows mortgage applications for new home purchases increased 3.6 percent compared to July 2017. Compared to June 2018, applications increased by 0.2 percent. This change does not include any adjustment for typical seasonal patterns.

MBA estimates new single-family home sales were running at a seasonally-adjusted annual rate of 637,000 units in July 2018, based on data from the BAS. The new home sales estimate is derived using mortgage application information from the BAS, as well as assumptions regarding market coverage and other factors.

"Our survey results indicate that new home sales for the month reached 637,000 units, the strongest pace since April 2018. This was likely supported by the May surge in housing starts and is a reflection of the strength of demand due to the healthy economy. Because inventory of existing homes remains quite tight, this increase in new home supply will be welcomed by the market," said Joel Kan, MBA Associate Vice President of Economic and Industry Forecasting.

The seasonally-adjusted estimate for July is an increase of 8.5 percent from the June pace of 587,000 units. On an unadjusted basis, MBA estimates that there were 53,000 new home sales in July 2018, unchanged from June.

By product type, conventional loans composed 72.1 percent of loan applications, FHA loans composed 15.3 percent, RHS/USDA loans composed 1.1 percent and VA loans composed 11.4 percent. The average loan size of new homes increased from $333,033 in June to $337,775 in July.

MBA's Builder Application Survey tracks application volume from mortgage subsidiaries of home builders across the country. Utilizing this data, as well as data from other sources, MBA is able to provide an early estimate of new home sales volumes at the national, state, and metro level. This data also provides information regarding the types of loans used by new home buyers. Official new home sales estimates are conducted by the Census Bureau on a monthly basis. In that data, new home sales are recorded at contract signing, which is typically coincident with the mortgage application.