October New-home Mortgage Applications Fall 2.6%

Mortgage applications for new-home purchases decreased 2.6% compared to a year ago, according to the Mortgage Bankers Association (MBA)’s Builder Application Survey data for October 2025.

Compared to the month prior, applications decreased by 1%. MBA noted that this change does not include any adjustment for typical seasonal patterns.

“Lower mortgage rates, ongoing usage of builder concessions, and growing levels of for-sale inventory drove an increase in new home sales for October. The annual sales pace, at 771,000 units, was the strongest in over a year,” said Joel Kan, MBA’s vice president and deputy chief economist.

“The increased use of ARM loans, for which rates were averaging almost 80 basis points lower than fixed-rate loans, also contributed to the jump in sales and a slightly higher average loan size, the third monthly increase. In October, our data showed that ARM loans accounted for 25% of applications, up from 16% a year ago.”

Kan added that MBA’s new-home sales estimate is a leading indicator of the U.S. Census Bureau‘s new-home sales figure, which has not been published since the release of August data prior to the federal government shutdown.

“Unadjusted mortgage application counts declined slightly over the month but remained at a healthy pace relative to the past three years,” he said.

MBA estimates new single-family home sales rose to a seasonally adjusted annual rate of 771,000 in October, up 13.4% from September’s pace of 680,000 units.

On an unadjusted basis, MBA projects 55,000 new homes were sold in October, a 1.9% increase from the prior month.

Conventional loans accounted for 51.9% of applications, followed by Federal Housing Administration (FHA) loans at 35.1%, U.S. Department of Veterans Affairs (VA) loans at 12.3% and U.S. Department of Agriculture (USDA) loans at 0.7%. The average loan size rose to $381,404 in October, up from $379,107 in September.

MBA’s estimate is based on data from its Builder Application Survey, which tracks mortgage applications from homebuilder affiliates.