RealtyTrac released its Q1 2016 U.S. Residential Property Loan Origination Report, showing 1.4 million (1,415,511) loans were originated on U.S. residential properties (1 to 4 units) in the first quarter of 2016, down 12 percent from the previous quarter and down 8 percent from a year ago to the lowest level since the first quarter of 2014.
The loan origination report is derived from publicly recorded mortgages and deeds of trust collected by RealtyTrac in more than 950 counties accounting for more than 80 percent of the U.S. population.
The year-over-year decrease in total originations was driven by a 20 percent year-over-year decrease in refinance originations, even while purchase originations increased 3 percent from a year ago and home equity line of credit (HELOC) originations increased 10 percent from a year ago.
“After a surprisingly strong 2015, the mortgage refi market started running out of steam in the first quarter of 2016 despite lower mortgage interest rates,” RealtyTrac Senior Vice President Daren Blomquist said in a news release. “Meanwhile the purchase loan market continued the pattern of slow-and-steady growth that it has been following the past two years, and HELOC originations increased on a year-over-year basis for the 16th consecutive quarter, showing that borrowers are regaining both home value and the confidence needed to increasingly leverage their home equity.”
Dallas has biggest HELOC increase
Among 50 metropolitan statistical areas with at least 5,000 total loan originations in the first quarter, those with the biggest year-over-year percentage increase in HELOC originations were Dallas (up 35 percent); Louisville, Ky. (up 28 percent); Seattle (up 25 percent); Sacramento, Calif. (up 25 percent) and Columbus, Ohio (up 23 percent).
Other metro areas with a 20 percent or more increase in HELOC originations from a year ago were San Antonio (up 23 percent); Orlando, Fla. (up 23 percent); Portland, Ore. (up 22 percent); Cincinnati (up 21 percent); and Tampa, Fla. (up 20 percent).