Nationwide, the share of non-conventional financing for new home sales accounted for 31% of the market per NAHB analysis of the 2024 Census Bureau Survey of Construction (SOC) data. This is 1.7 percentage point lower than the 2023 share of 32.4%. As in previous years, conventional financing dominated the market at 69.3% of sales, higher than the 2023 share of 67.6%.
Non-conventional forms of financing (as opposed to conventional mortgage loans) include loans insured by the Federal Housing Administration (FHA), VA-backed loans, cash purchases and other types of financing such as the Rural Housing Service, Habitat for Humanity, loans from individuals, or state or local government mortgage-backed bonds. The reliance on non-conventional forms of financing varied across the United States, with its share at almost 40% in the East North Central division but only 24% of new single-family home starts in the South Atlantic division.
Nationwide, cash purchases were the majority share of non-conventional financing of new home purchases, accounting for 13% of the market share, slightly down from 14% in 2012. However, a NAHB survey based on builders reported that for 2024, all-cash sales were a higher share at 22%. Meanwhile, the Census reported FHA-backed loans accounted for 11% in 2024, whereas in 2023, they had a 12%market share. The share of VA-backed loans was at 4% market share in 2024, while Other Financing was 3% of market share.
Regionally, cash financing held the highest share in the East North Central division, where 27% of all homes started were purchased with cash. Cash purchases led non-conventional financing in five out of nine census regions with27% in East North Central, 23% in New England, 21% in East South Central, 16% in Middle Atlantic, and 15% in West North Central.
FHA-backed loans accounted for the majority of all non-conventional financing in the West South Central division, accounting for 20% homes started. In New England, very few homes used FHA-backed loans at just _%, along with the East South Central division at just 1% of homes started.
VA-backed loans were most used in the West North Central division, accounting for 10% of non-conventional forms of financing. Notably, in New England, only 1% of the homes started used VA-backed loans in 2024.
Other financing such as the Rural Housing Service, Habitat for Humanity, loans from individuals, state or local government mortgage-backed bonds were highest in the East South Central division where it was collectively 14% of market share, while the Mountain division reported the lowest share at 1%.
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