In the third quarter, mortgage lending increased 45% year over year and quarterly 17% to the highest number of originations since 2007, according to Attom Data Solutions.
Consumers came out in droves to hedge record-low interest rates. A total of 3.25 million home loans were completed in the quarter. Origins of purchase accounted for 1.05 million of that, increasing 25.4% per year and 28.1% per quarter. With 1.96 million loans, refinancing had the largest share of originations, an increase of 84.5% compared to the previous year and 15.7% compared to the second quarter.
Home credit lines negatively impacted by the coronavirus decreased to a total of 244,555. This is the lowest since 2014 and reflects a decrease of 28.7% from the previous year and 7.1% from the previous quarter.
"The home loan industry got even busier in the third quarter of 2020. The real estate market was still functioning as if the pandemic-sparked recession didn't exist," Todd Teta, chief product officer at Attom Data Solutions told the report. "Buyers and property owners, attracted to low mortgage rates, repeatedly positioned themselves for credit at levels not seen in more than a decade. The only difference in the third quarter was that purchase credit (growth) was the Refinancing activity for the first time in more than a year defeated than a year. "
The increase in lending was $ 974.1 billion, up 52% year over year and 20% quarter over quarter. This was the highest borrowing rate since 2005. The purchases raised $ 336.3 billion, refinanced $ 587.6 billion and HELOCs approximately $ 49.9 billion.
While Teta referred to the activity as "another banner district for lenders," he is cautious, noting that "the pandemic and other factors could come together and stop the market boom".
In the housing markets of more than 1 million residents, the largest quarterly growth in purchases was in Boston (up 75.3%), Hartford, Connecticut (up 52.6%) and San Jose, California (up 49.8%) . Only Baltimore (minus 7%) and Pittsburgh (minus 3.6%) fell in the second quarter.
The largest quarterly increases in residential real estate were in Tucson, Arizona (up 38.4%), Virginia Beach, Virginia (up 37.8%) and Richmond, Virginia (up 35%). Pittsburgh led the refi declines with a 29.5% decrease, followed by a 14.8% decrease in Rochester, New York, and 9.6% in Detroit.
The mortgages supported by the Federal Housing Administration totaled 336,272. This accounted for 10.3% of all origins of residence, after 13.2% year-on-year and after 9.4% in the last quarter. Loans backed by the Department of Veterans Affairs totaled 283,216 mortgages. The VA share of 8.7% fell slightly compared to 8.8% in the previous year and rose from 8.5% in the second quarter.