New-home mortgage applications decline in July

Mortgage applications for newly built homes declined in July, falling 5.7% compared to the previous year and 1% from June, according to data from the Mortgage Bankers Association (MBA) Builder Application Survey.

Joel Kan, MBA’s Vice President and Deputy Chief Economist, noted that purchase activity slowed as both applications and estimated new home sales fell behind last year’s pace. The MBA estimated that new single-family home sales were running at a seasonally adjusted annual rate of 647,000 units in July, a 3% decrease from the June pace of 667,000 units. This represents the third decline in four months and sits below the average annualized pace of 664,000 units seen during the first half of the year.

Despite builders offering various incentives—including price reductions, mortgage-rate buydowns, and closing-cost assistance—demand remains weak. Analysts suggest that elevated mortgage rates are driving increased sensitivity among homebuyers, even as inventory levels remain high.