- According to the Optimal Blue Mortgage Market Indices, 30-year conforming rates crossed 7% for the first time since November 2022, before falling sharply and then rebounding to 6.88%
- Overall rate lock volumes were down 7% month over month in July, with purchase lending continuing to make up the vast amount of lock volume, accounting for 88% of total lock activity
- Even so, purchase lock counts were down 27% year over year and 35% compared to 2019 pre-pandemic levels, as higher interest rates and persisting low inventories dampened demand
- As reported in Black Knight’s most recent Mortgage Monitor report, signs of credit tightening have been seen in July locks in rising down payments, falling loan-to-value ratios and higher credit scores
- Average purchase price edged lower to $456K, with an average loan amount of $358K in July as we move past the historically typical June pricing peak
- The average credit score among primary residence purchase locks hit a record high in the first week of July before edging modestly lower to remain flat in July
- Adjustable-rate mortgages (ARMs) fell to 6.79% of July’s rate lock activity, as rates for such products became less competitive against fixed products
JACKSONVILLE, Fla., Aug. 14, 2023 /PRNewswire/ — Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through July 2023 month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE, the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.
“While they moved around a bit in July, there was no escaping the fact that conforming 30-year rates topped 7% in July for the first time since they spiked last fall,” said Andy Walden, vice president of enterprise research and strategy at Black Knight. “On both a practical and psychological level, that put further downward pressure on mortgage demand. Purchase loans continue to dominate the origination pipeline, but current housing market dynamics are just not conducive to boosting homebuyer origination volumes.”
The month’s pipeline data showed rate lock activity fell for the second consecutive month, dropping 7% overall. Purchase locks, which accounted for 88% of all July activity, fell 7.4% from June. Longer term, purchase lock counts are down 27% year over year and 35% off 2019 pre-pandemic, levels. Cash-out refinances also declined (-5.4%) and are hovering close to 60% below where they were in July 2022 when interest rates averaged in the mid- to high 5% range. Rate/term refis increased by a modest 1.9% in July, but remained down more than 31% year over year from an extremely low ceiling; July 2022 itself had marked a 93% year-over-year decline. Locks on such products will likely remain constrained for some time to come; just 3% of existing mortgage holders have first-lien rates at or above today’s levels.
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Source: www.prnewswire.com
ENB
Sandstone Group
