ATTOM: Home Loan Originations at 4-Year Low

ATTOM Data Solutions, Irvine, Calif., reported a 16 percent drop in residential property originations in the second quarter from the first quarter and a 27 percent drop from a year ago.

The company’s quarterly U.S. Residential Property Loan Origination Report said 1.527 million loans secured by residential property originated in the second quarter, falling to the lowest level since Q1 2014. The report said 662,713 loans originated were purchase loans, down less than 1 percent from the previous quarter and down 28 percent from a year ago. Refinances totaled 591, down 26 percent from the previous quarter and down 27 percent from a year ago.

The report said 272,852 Home Equity Lines of Credit originated on residential properties in the second quarter, down 22 percent from the previous quarter and down 23 percent from a year ago

“Rising mortgage rates are cooling mortgage demand across the board, with overall originations down to their lowest level since 2014–the last time we saw more than six consecutive months with average 30-year fixed mortgage rates above 4 percent,” said Daren Blomquist, senior vice president with ATTOM Data Solutions. “Meanwhile buyers are upping the ante when it comes to down payments, evidenced by the record-high median down payment for homes purchased in the quarter, and an increasing number of buyers are getting help from co-buyers.”

ATTOM said only four of 173 metros analyzed posted a year-over-year increase in loan originations, counter to the national trend: Hagerstown, Md., (up 51 percent); Beaumont-Port Arthur, Texas (up 16 percent); Raleigh, N.C. (up 13 percent); and Ocala, Fla. (up 1 percent).

Nine metros posted a year-over-year increase in purchase loan originations, including Raleigh (up 2 percent); Palm Bay, Fla. (up 12 percent); Wichita, Kan. (up 9 percent); Lancaster, Pa. (up 10 percent); and Amarillo, Texas (up 65 percent). Sixteen metros posted a year-over-year increase in refinance originations, including Phoenix (up 3 percent); Houston (up 28 percent); Orlando (up 3 percent); Raleigh (up 18 percent); and Boise, Idaho (up 14 percent).

Twenty-two metros posted a year-over-year increase in HELOCC originations, including Raleigh (up 32 percent); Hartford, Conn. (up 35 percent); Providence, R.I. (up 4 percent); Colorado Springs, Colo. (up 17 percent); and Bridgeport, Conn. (up 30 percent).

Other report highlights:

–The median down payment on single family homes and condos purchased with financing in the second quarter rose to $19,900, up 19 percent from $16,750 in the previous quarter and up 18 percent from $16,925 a year ago to a record high dating back to Q1 2000.

–Nationwide, 17.6 percent of all single family home purchases in the second quarter were to co-buyers (multiple, non-married buyers listed on the sales deed), up from 17.4 percent in the previous quarter.

–The average down payment for homes purchased by co-buyers nationwide rose to $63,117, 51 percent higher than the average down payment of $41,749 for homes purchased by other homebuyers. The average co-buyer down payment represented 16.3 percent, more than double the average down payment percentage of 8.1 percent for other homebuyers.

–Residential loans backed by FHA accounted for 10.2 percent of all residential property loans originated in the second quarter, down from 10.9 percent in the previous quarter and down from 13.5 percent a year ago to the lowest share since Q1 2008.

–Residential loans backed by the VA accounted for 5.5 percent of all residential property loans originated in the second quarter, down from 6.2 percent in the previous quarter and down from 6.4 percent a year ago.