FHA-Backed Loans: Majority of Non-Conventional Financing In 2017
There are several forms of non-conventional financing including FHA (loans insured by the Federal Housing Administration), VA (loans guaranteed by the United States Department of Veterans Affairs), cash purchases, Rural Housing Service (loans and grants backed by the Single-Family Housing Program), Habitat for Humanity (nonprofit Christian organization funding affordable housing), loans from individuals, and state or local government mortgage-backed bonds.
The 2017 Census Bureau Survey of Construction (SOC) concluded that only 30.8% nationwide financing was non
-conventional. The share of non-conventional financing varies across the United States. In the South Atlantic and West South-Central areas of the country non-conventional accounts for 35.4% and in the East North Central it only accounts for 15.5% of new single-family home starts.
FHA-backed loans make up 12.2% of non-conventional financing nationwide making the loans the majority of the non-conventional financing. In the South Atlantic region FHA made up 19.6%, in the West South Central 13.6%, Pacific 12.8% and New England was the lowest at 0.6%.
Cash purchases made up 9.6% which was the second highest form of non-conventional loans. New England was the highest with 27.3%, Middle Atlantic 15%, East North Central 10.9%, West North Central 10.7%, East South Central 7.9% and South Atlantic only 5.7%. VA-backed loans only accounted for 1% nationwide with the Mountain region being the highest with 13%. Rural Housing Service, Habitat for Humanity, loans from individuals, state or local government mortgage-backed bonds were the highest in West South-Central area at 4.1% and the lowest in New England at 1%.
