ATTOM Data Solutions early Thursday released its fourth-quarter 2019 U.S. Residential Property Mortgage Origination Report, which shows that 1.27 million refinance mortgages secured by residential property were originated in the fourth quarter of 2019. That figure is up 20% from the third quarter of 2019 and up 104% from the fourth quarter of 2018, to the highest point since the third quarter of 2013.
With interest rates near all-time lows, the refinance mortgages originated in the fourth quarter of 2019 represented an estimated $391.3 billion in total dollar volume, up 19% from the previous quarter and up 138% from a year ago to the highest level since the first quarter of 2013. Total residential loan originations rose 40%, year-over-year, in the fourth quarter of 2019 to 2.27 million, the highest point since the third quarter of 2016.
“The fourth quarter was a banner period for residential mortgages across the United States, as declining interest rates and a strong economy helped spur more than 2 million borrowers to sign on for new or refinanced loans,” said Todd Teta, chief product officer at ATTOM Data Solutions. “Refinancing largely drove the trend, with more than twice as many homeowners trading in higher-interest mortgages for cheaper ones than in the same period of 2018. These trends could all change when the economic fallout from the Coronavirus outbreak hits. But the last few months of 2019 saw a burst of lending activity not seen in the U.S. housing market for several years.”
Lenders originated 1,274,495 refinance mortgages in the fourth quarter of 2019, up 19.6% from the third quarter of 2019 and up 104.2% from the fourth quarter of 2018. Residential refinance mortgage originations increased, year over year, in 207 of the 209 metropolitan statistical areas that have a population greater than 200,000 and were analyzed for this report, including those greater metro areas of New York, NY (up 91.5%); Los Angeles, CA (up 158.8%); Chicago, IL (up 144.5%); Dallas, TX (up 90.0%) and Houston, TX (up 32.9%). The only metro areas that ran counter to the national year-over-year trend were Beaumont, TX (down 6.8%) and McAllen, TX (down 9.1%).
Lenders originated 685,898 residential purchase mortgages in the fourth quarter of 2019, down 13.3% from the previous quarter, but up 3.1% from a year earlier. Residential purchase mortgage originations increased from a year ago in 141 of the 209 metro areas that have a population greater than 200,000 and were analyzed for this report, including those greater metro areas of Los Angeles, CA (up 13.8%); Chicago, IL (up 1.6%); Washington, DC (up 3.7%); Philadelphia, PA (up 2.1%) and Miami, FL (up 2.9%). Counter to the national trend, residential purchase mortgage originations decreased from a year ago in 68 of the 209 metro areas analyzed in the report, including the greater metro areas of New York, NY (down 1.0%); Dallas, TX (down 14.7%); Houston, TX (down 16.8%); Minneapolis, MN (down 3.8%) and Tampa, FL (down 6.9%).
A total of 307,180 home equity lines of credit (HELOCs) were originated on residential properties in the fourth quarter of 2019, down 8.9% from the previous quarter and down 5.5% from a year earlier. Residential HELOC mortgage originations decreased from a year ago in 56.5% of metropolitan statistical areas that have a population greater than 200,000 and were analyzed for this report, including New York, NY (down 13.5%); Los Angeles, CA (down 20.6%); Chicago, IL (down 4.9%); Washington, DC (down 14.5%) and Philadelphia, PA (down 0.3%). Counter to the national trend, residential HELOC mortgage originations increased from a year ago or stayed the same in 43.5% of the metro areas analyzed for the report, including Dallas, TX (up 3.9%); Houston, TX (up 37.0%); Boston, MA (up 4.0%); St. Louis, MO (up 5.1%) and Charlotte, NC (up 6.4%).
Mortgages backed by the Federal Housing Administration (FHA) accounted for 294,206, or 13%, of all residential property loans originated in the fourth quarter of 2019. That was down from 289,593, or 13.2%, of all loans in the previous quarter, but up from 199,004, or 12.3% of all loans, a year ago. Residential loans backed by the U.S. Department of Veterans Affairs (VA) accounted for 9.1% of all residential property loans originated in the fourth quarter of 2019, the highest%age since at least 2000. The figure was up from 8.7% in the previous quarter and from 6.3% a year ago.
