"New homes remain a viable option for many homebuyers given that there is a relatively large number of new homes available for sale, which has prompted incentives and price reductions from builders in some markets. Kan noted that the annualized sales pace dropped to 640,000 units in December, the slowest sales pace since May 2025. But that was still nearly 7% higher compared to the December 2024 pace."
"In our latest forecast, we expect new home sales in 2026 will increase gradually as mortgage rates stay close to current levels and sales price growth remains muted, given the excess inventory, Kan added. MBA's estimate which is based on mortgage application data from its Builder Application Survey and other assumptions, is considered a leading indicator of the U.S. Census Bureau's New Residential Sales report. Kan said the current data available is only through October 2025 due to delays stemming from the recent government shutdown."
"Conventional loans accounted for 50.5% of applications, followed by Federal Housing Administration (FHA) loans at 34.7%, U.S. Department of Veterans Affairs (VA) loans at 13.8% and U.S. Department of Agriculture (USDA) loans at 0.9%. The average loan size for new homes rose to $380,607 in December, up from $378,063 in November. The Builder Application Survey tracks mortgage application volume from builder-affiliated lenders nationwide. It provides early estimates of new home sales at the national, state and metro-area levels, as well as data on loan types used by homebuyers."
December purchase activity for newly built homes ran stronger than the prior year despite a slight cooling from November. The annualized sales pace dropped to 640,000 units in December, the slowest since May 2025, yet remained nearly 7% above December 2024. Seasonally adjusted estimates fell 15.2% from November's 755,000 pace, while unadjusted sales were about 50,000, down 2% month-over-month. Conventional loans comprised 50.5% of applications, followed by FHA 34.7%, VA 13.8% and USDA 0.9%. The average new-home loan size rose to $380,607 in December. MBA's estimate, derived from the Builder Application Survey, is a leading indicator with data current only through October 2025 due to a government shutdown delay. Forecasts expect gradual sales growth in 2026 as mortgage rates hold and price growth remains muted amid excess inventory.
Read at www.housingwire.com
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