Your inside source for real estate, development and construction information serving the counties of Mecklenburg, Union & Iredell VOLUME 106 NUMBER 46 ■ MECKTIMES.COM
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Steep drop in mortgage lending continues across U.S. in third quarter, hitting three-year low ATTOM has released its third-quarter 2022 U.S. Residential Property Mortgage Origination Report, which shows that 1.97 million mortgages secured by residential property (1 to 4 units) were originated in the third quarter of 2022 in the United States. That figure was down 19 percent from the second quarter of 2022 – the sixth quarterly decrease in a row – and down 47 percent from the third quarter of 2021 – the biggest annual drop in 21 years. The continued decline in residential lending resulted from double-digit downturns in both refinance and purchase loan activity that far outweighed another increase in home-equity credit lines. Overall, lenders issued $636.5 billion worth of mortgages in the third quarter of 2022. That was down quarterly by 22 percent and 46 percent annually. As with the number of loans, the annual decrease in the dollar volume of mortgages stood out as the largest since at least 2001 and was the latest sign that the 11-year U.S. housing market boom is losing steam. “There are no surprises in this
quarter’s loan origination numbers, as the unprecedented jump in mortgage rates has battered both the purchase and refinance markets,” said Rick Sharga, executive vice president of market intelligence at ATTOM. “Prospective homebuyers have been priced out of the market by the combination of 7 percent mortgage rates and higher home prices. And refinance activity will probably continue to decline, since the majority of homeowners have loans with sub-4 percent interest rates.” The continued dip came as just 661,000 residential loans were rolled over into new mortgages and borrowers took out only 943,000 loans to buy homes during the third quarter of 2022. During a period when mortgage interest rates continued to climb, refinancing activity was down 31 percent from the second quarter of 2022 and 68 percent from a year earlier. Refinancing activity has dropped for six consecutive quarters, to a level that is just one-quarter of what it was in early 2021. The dollar volume of refinance loans in the period running
from July through September was down 33 percent from the prior quarter and 67 percent annually, to $212 billion. The number of purchase loans, meanwhile, slumped by 16 percent quarterly and 33 percent annually, while the dollar volume decreased to $353.9 billion. Only a 5 percent quarterly jump in the number and value of HELOCs – the third quarterly straight gain - kept the industry from seeing an across-the-board contraction. By the end of the third quarter, refinance activity represented just a third of overall mortgages, compared to two-thirds as recently as the first quarter of last year. Purchase lending continued at just under half of all activity in the third quarter of 2022, while home-equity packages comprised one of every five mortgage deals completed. That ratio for so-called HELOC loans was up from one of every 21 a year and a half ago.
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“Ram is thrilled to acquire a property with such tremendous redevelopment potential.” David Klepser Managing Director for Ram Realty Advisors
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