Declining Mortgage Volume: The 14-Year Low
Mortgage volume in the first quarter of 2014 hit its lowest level in 14 years, according to the Wall Street Journal today. Volume was almost 60% less than it was during the same quarter of 2013. The primary reason is the fall off in refinances.
Benefits for Buyers, Realtors, and the Economy
This is a good thing for buyers and Realtors for several reasons. Less volume means more competition and therefore lower rates and faster service, as lenders compete with one another. Lenders are also getting more creative and flexible in regard to underwriting guidelines in order to bolster volume.
Loan officers are also more willing to work with Realtors in symbiotic ways in order to build a business on both the real estate and lending side.
Finally – a general increase in rates is often good for the economy overall, as it restores “normal investment channels” and makes the economy more dynamic. This means more jobs, more transfers, more housing demand, and more inventory.
