July's low mortgage rate environment encouraged new homebuyers to overcome their fears about the direction of the economy that kept them
The group's Builder Application Survey showed an 11% increase in activity compared with June — where activity had declined compared with May — and a 31% increase
"July's strong new-home sales increase on a monthly and annual basis was driven by the
The average loan size of new homes decreased to $325,457 in July from $329,593 in June and $337,775 in July 2018.
New single-family home sales were running at a seasonally adjusted annual rate of 754,000 units in July 2019, the MBA estimated based on data from the BAS. This is an increase of 16.7% from the June pace of 646,000 units.
On an unadjusted basis, there were an estimated 63,000 new home sales in July 2019, an increase of 8.6% from 58,000 new home sales in June.
By product type, conventional mortgages made up 69.1% of loan applications for a newly constructed property; Federal Housing Administration, 18.1%; Veterans Affairs, 11.7%; and U.S. Department of Agriculture Rural Housing Service, 1%.
Separately, authorizations for new single-family construction during July fell 4.18% year-over-year and rose by a scant 32 basis points when compared with June, according to the BuildFax Housing Health Report.
"Over the past three months, single-family housing authorizations have remained relatively flat, increasing or decreasing within one percentage point month over month. However, in contrast to 2018's rapid new-housing growth, year-over-year activity is still experiencing steady declines," the report said.
When it came to existing housing, the maintenance volume increased by 2.36% over July 2018 and remodeling activity (a subset that measures renovations, additions and alterations) was up 4.3% compared with one year prior.
This year saw "several months of significant declines across the existing housing supply," Jonathan Kanarek, BuildFax's chief operating officer, said in a press release.
"However, since April, declining maintenance and remodel activity has slowed. While one month of increasing activity is not a trend, it may signify the start of a stabilizing in the housing stock. It's still early, but if existing housing activity maintains its current pace, that's a positive sign for the stability and health of the U.S. housing stock," Kanarek said.