Guaranteed Rate has issued its first national mortgage data summary, providing a snapshot of the U.S. mortgage market. The data is based on more than 55,000 loans funded by Guaranteed Rate coast to coast during 2013, totaling nearly $16 billion. Overall loan volume was up by five percent nationwide in 2013 on a year over year basis, fueled by growth in purchase loan volume of 17 percentage points compared to 2012. The growth in purchase loans offset a year over year decline in refinancing activity, an industrywide slowing caused by the mid-year rise in interest rates. Overall loan volume was split nearly evenly between purchase and refinance volume in 2013, where 2012 saw nearly two-thirds of loan volume coming from the refinance market.
The median purchase price rose 13 percent in 2013, tracking a national trend of rising home prices and lack of housing supply in many markets nationwide.
The 30-year fixed-rate mortgage (FRM) remained the most popular option for homebuyers, accounting for approximately 73 percent of overall loan volume, while 15-year fixed loans accounted for 13 percent, and ARMs accounted for nine percent. Total ARM volume increased by nearly 50 percent year over year.
Nationally, the average credit score per loan held steady, declining less than one percent compared to 2012. The average real estate taxes paid per loan declined approximately nine percent, from $5,933 to $5,377.
The 20 percent downpayment was the most popular option for homebuyers in 2013, accounting for 55 percent of all purchase loan volume, a five-point percentage increase from 2012.
Investor activity continued to climb steadily in 2013, as the total number of loans for investment properties rose 35 percent over 2012, boosting their percentage of overall loan volume by two percent year over year to eight percent.
“These numbers reflect the mortgage market of 2013—a strong purchase market and a refinance market falling off after interest rates rose at the start of the third quarter,” said Ted Ahern, chief financial officer of Guaranteed Rate. “The lack of housing inventory in many areas is helping to boost home prices, but the increase in investor activity is a positive sign for the market moving forward.”
Guaranteed Rate also issued summaries of mortgage activity in five major U.S. markets:
►New York/New Jersey metro: Rising home values were the big story in this area, as the median purchase price jumped 21 percent over 2012, from $405,000 to $490,500. Purchase loan volume went up 12 percentage points over the previous year to 49% of overall volume. ARM volume tripled year over year to 18 percent of total loan volume in 2013 from six percent in 2012. Investment property loan volume ticked up one percentage point to six percent of overall volume.
►Chicago metro: Purchase loan volume leaped 20 percentage points over 2012 to 52 percent of overall loan volume in 2013, with a corresponding drop in refinance volume due to higher rates. Median purchase price for the region went up seven percent year over year, from nearly $276,000 to $296,000. Median prices in the city of Chicago also went up 10 percent, from $324,000 to $355,300. ARM volume increased three percentage points in 2013 to 11 percent of overall loan volume. Investment property loans went up one percentage point to seven percent of total volume across the area.
►Southern California (Los Angeles/San Diego metro): This is another region that saw a large increase in the median purchase price, soaring 23 percent over 2012, from $306,300 to $376,000. Purchase loan volume increased by seven percentage points year over year to 54 percent of total volume, and ARM volume more than doubled, going from three percent of loan volume to eight percent. In turn, 30-year fixed loan volume dropped three percentage points from 2012 to 2013.
►San Francisco Bay Area: Median home purchase prices in the Bay Area continued their steady rise, jumping 10 percent over 2012, from $450,000 to $496,000. Purchase loans went up 19 percentage points year over year to 50 percent of overall volume. With rising interest rates, buyers returned to ARMs in the region, with volume quadrupling in percentage points, from three percent to 12 percent. Investment property volume ticked down as a percentage decline by a slight one point, to 15 percent of overall volume.
►Boston metro: Housing prices held steady in the region, with the median purchase price going up three percent, from $374,500 to $385,400. Purchase loans rose more dramatically, however, going up 22 percentage points over 2012 to 47 percent of overall volume. 30-year fixed loan volume shook off higher rates in the area, rising eight percentage points year over year to 70 percent of overall volume. Investment property loan volume went up by two percentage points year over year, to eight percent of total volume.