New-Home Mortgage Applications Trend Down in May

Despite the housing market shifting in favor of buyers, mortgage applications for new home purchases declined in May. According to the Mortgage Bankers Association’s Builder Application Survey, mortgage applications for new-home purchases declined by 9% compared with April 2025 and by 4.5% from one year ago. It is estimated that new single-family home sales were at a seasonally adjusted annual rate of 631,00 units in May, which is a 12.1% decrease from the April pace of 718,000.

“Economic uncertainty, rising mortgage rates, and increasing competition from growing existing-home sales inventory likely dampened overall demand for new home purchases in May,” said Joel Kan, MBA’s Vice President and Deputy Chief Economist. “Applications to purchase newly built homes fell to their slowest pace in three months as buyers held off on their purchase decisions. Estimated new home sales posted a 12 percent drop, reversing April’s large gain and closer to levels seen earlier in the year.”