Continuing a strong start to 2017, February mortgage applications for new home purchases grew 2.2% from a year ago.
February application volume also grew 16% from the previous month, according to the Mortgage Bankers Association. The data is not seasonally adjusted.
While the year-over-year gain is modest, it is coming off what had been a strong February 2016 for new home applications, said Lynn Fisher, the MBA's vice president of research and economics, in a press release, and things are shaping up for a strong year for new home purchases.
"The surprisingly strong employment numbers for the beginning of 2017 suggest that demand for new homes should continue to grow this year. Additionally, based on the current reading, we expect seasonally adjusted new home sales to be up by about 8% in February compared to a year ago," Fisher said.
New single-family home sales were at a seasonally adjusted annual rate of 586,000 units in February, an increase of 4.3% from the January pace of 562,000 units, according to the MBA's estimate. On an unadjusted basis, there were 51,000 new home sales in February, an increase of 15.9% from 44,000 new home sales in January.
Applications for conventional loans made up 66.5% of the total, with Federal Housing Administration-insured loans at 18.6%, Veterans Affairs-guaranteed loans at 13.6% and U.S. Department of Agriculture Rural Housing Service loans at 1.3%. The average loan size increased to $330,208 in February from $329,806 in January.