The total number of mortgages secured by residential property increased to 1.56 million during Q2 2023, according to a new report from ATTOM. While that remained down 38% from a year earlier, it was up 21% from last quarter—the first increase in two years.
ATTOM’s Residential Property Mortgage Origination Report for Q2 2023 found that banks and other lenders issued a total of 1,555,469 residential mortgages, up 20.8% from 1,287,442 last quarter, although still down 37.6% from 2,493,790 last year. The report stated that the revival followed a two-year slump that had reduced total lending numbers to almost their lowest point this century.
In addition, the report found that a total of $494.3 billion was lent, down 41.5% from $844.3 billion a year earlier, but up 23.5% from $400.3 billion last quarter. Overall lending activity remained down annually in all 197 metro areas tracked in the report. However, it increased in 192 (97%) of those metro areas. Total lending activity rose at least 15% quarterly in 167 of those areas (85%).
Key highlights:
- Lenders issued 477,219 residential refinance mortgages, down 51.1% from 975,997 last year and remained 83% less than a peak of 2,743,700 in 2021.
- As with total lending, the number of refinance deals had dipped for eight straight quarters before turning back upward in the period running from April through June of this year.
- The $141 billion dollar volume of refinance packages was still down 56.6% from $325 billion last year, but was 7.9% above the $130.7 billion last quarter.
- Refinancing activity remained down in all but one of the 197 metro areas around the U.S. But it was up quarterly in 178, or 90%, of those metros.
- Lenders originated 793,659 purchase mortgages, down 31.8% from 1,164,284 a year earlier and 47.6% from a peak of 1,515,922 in 2021. But the number was up 28.8% from 616,206 last quarter, following seven straight quarterly declines.
- The $302.4 billion dollar volume of purchase loans remained down 32.9% from $450.4 billion a year earlier, but was 35.9% more than the $222.5 billion last quarter.
- While residential purchase-mortgage originations decreased annually in 187 of the 197 metro areas in the report (95%), they were up quarterly in 193 (98%).
- A total of 284,591 home-equity lines of credit (HELOCs) originated on residential properties, down 19.5% annually but up 12.9% from 251,975 in the prior quarter. The increase came after two consecutive quarterly declines.
- The $50.9 billion volume of HELOC loans remained down 26.2% year-over-year, but was up 8% from $47.1 billion last quarter.
- HELOC mortgage originations increased in 79% of the metro areas analyzed.
- Mortgages backed by the FHA rose as a portion of all lending for the seventh straight quarter. They accounted for 213,944 (13.8%) of all residential property loans, up from 12.9% last quarter and 10.7% last year.
Major takeaway:
“Home buyers and owners alike lined back up again at the doors of mortgage lenders this Spring seeking loans of all kinds. It looks like owners took advantage of the small rate drop to refinance existing loans, while a jump in mortgages for purchasers was likely fueled by a number of forces that pushed the overall housing market to heat back up during the Spring buying season,” said ATTOM CEO Rob Barber. “Buyers also might have jumped back in amid worries about even more rate increases that could have price them out of a new home.”
Barber added, “Lenders certainly aren’t anywhere near as busy as they were back in 2021. And the second quarter surge could be just a momentary thing. But the upturn was significant, and a testimony to how strong the housing market remains around the country.”
For the full report, click here.
