Refinance Lending still Powering Mortgage Activity

Key Highlights

• Total lending in Q1 2021 up +3%
• Refinance lending in Q1 2021 up +12%

Increase in Total Mortgage Activity Not Seen Since 2009

ATTOM Data Solutions’ Q1 2021 US Residential Property Mortgage Origination Report indicates there were 3.77M new mortgages secured by residential property during Q1 2021.

These 3.77M new mortgage originations secured in Q1 2021 represented an increase of approximately +3% from those in Q4 2020 and a whopping +71% from Q1 2020, the highest level in more than 14 years.

This increase in mortgage originations was the first time the total number of home mortgages increased for a Q4 period to a Q1 period since 2009.

Refinance Mortgages Spurred Jump in Total Activity

According to ATTOM,refinance lending has more than doubled in just one year.

Lenders refinanced 2.55M home mortgages during Q1 2021, an increase of +12% over Q4 2020 and an eye-popping +113% over Q1 2020.

The dollar amount of these new refinance loans jumped to $777.5B, an increase of +14% from Q4 2020 and a whopping +114% from Q1 2020.

Lenders issued 2,549,126 refinance loans in Q1 2021…the most since Q3 2003.

Refinance lending represented 68% of total mortgage activity during Q1 2021.

Refinancing Activity Up in 78.7% of Metro Areas

Refinancing activity with populations of 200,000 or more grew by 78.7% from Q4 2020 to Q1 2021.

The largest increases in refinancing during Q1 2021 included these metros:

• Jackson MS – +92.9%
• Springfield MA – +59.5%
• Medford OR – +57.3%
• Buffalo NY – +55%
• Macon GA – +53.3%

Conversely, metros with the biggest declines in refinancings included:

• Ann Arbor MI –54.5%
• Syracuse NY – -28.5%
• Pittsburgh PA – -23.1%
• Des Moines IO – -21.8%
• Lubbock TX – -18.8%

Q1 2021 Sees Unusual Quarterly Increase in Total Lending

According to Todd Teta, ATTOM’schief product officer, “Homeowners lined up to refinance their loans in ever-growing numbers during the first quarter of 2021, making for a highly unusual quarterly increase in total lending activity for that time of year. The home mortgage industry almost always slows down in winter, but not this year because so many homeowners are hoping on the super-low interest rates to reduce their monthly payments.”

Teta continued.  “Eventually, the refi side of the lending business will ease up after enough homeowners get in on the good deals.  But there’s no sign of that happening in the very near future – yet another indicator of how the housing market remains strong amid uncertain economic times connected to the pandemic.”

Thanks to ATTOM Data Solutions.

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