Your inside source for real estate, development and construction information serving the counties of Mecklenburg, Union & Iredell VOLUME 106 NUMBER 30 ■ MECKTIMES.COM
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Mortgage lending plummets across U.S. In first quarter
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ATTOM has released its first-quarter 2022 U.S. Residential Property Mortgage Origination Report, which shows that 2.71 million mortgages secured by residential property (1 to 4 units) were originated in the first quarter of 2022 in the United States. That figure was down 18 percent from the fourth quarter of 2021 – the largest quarterly decrease since 2017 – and down 32 percent from the first quarter of 2021 – the biggest annual drop since 2014. The decline, which marked the fourth straight quarterly decrease, resulted from doubledigit downturns in purchase and refinance activity, even as home-equity lending rose. Overall, lenders issued $892.4 billion worth of mortgages in the first quarter of 2022. That was down quarterly by 17 percent and annually by 27 percent. As with the number of loans, the quarterly
and annual decreases in the dollar volume of loans were the largest in five and eight years, respectively. The biggest contributor to the downturn was a decrease in refinance deals. Just 1.45 million residential loans were rolled over into new mortgages during the first quarter of 2022, down 22 percent from the fourth quarter of 2021 and 46 percent from a year earlier. Amid rising mortgage interest rates, the number of refinance mortgages decreased for the fourth straight quarter while the annual drop was the largest since 2014. The dollar volume of refinance loans was down 20 percent from the prior quarter and 42 percent annually, to $470.7 billion. Refinancing, while still a majority of residential lending activity, also decreased again as a portion of all loans during the first quarter of 2022. They represented 53 percent of all first-quarter mortgages, down
from 56 percent in the fourth quarter of 2021 and 67 percent in the first quarter of 2021. “The drop-off in Q1 refinancing activity is no surprise with mortgage rates rising as rapidly as they have,” said Rick Sharga, executive vice president of market intelligence at ATTOM. “But many forecasts expected purchase loans to remain strong in 2022, and even increase in both the number of loans originated and the dollar volume of those loans. The weakness in purchase loan activity shows just how much of an impact the combination of escalating home prices and rising interest rates have had on borrower activity this year.” Purchase-loan activity shrank in the first quarter of 2022 as lenders issued 1.01 million mortgages to buyers. That tally was down 18 percent quarterly and 12 percent annually. The dollar value of loans taken out to buy
residential properties dipped to $371.3 billion, down 16 percent from the fourth quarter of last year and 1 percent from the first quarter of 2021. Despite those decreases, purchase loans remained at 37 percent of all loans in the first quarter of 2022 and were still up annually from 29 percent. In the one category that bucked the trend, homeequity lending went up 6 percent quarterly and 28 percent annually, to 249,900. So-called HELOC mortgages represented 9 percent of all first-quarter residential loans, up from 7 percent in the fourth quarter of 2021 and 5 percent in the first quarter of last year. The continued shrinkage in overall residential lending during the first quarter reinforced a stark reversal for the mortgage industry following a near-tripling of activity from early 2019
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“Our research signals that innovative remote and hybrid approaches to work indeed are working.”
Melissa Jezior Eagle Hill Consulting
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