Fourth-quarter originations reach highest level since 2005

Residential mortgage origination volume rose to its highest level since the end of 2005, growing to $752 billion in fourth-quarter 2019.

That’s one of the big takeaways from a new report from the Center for Microeconomic Data at the Federal Reserve Bank of New York. The latest dollar figure represents an increase of 42.4% from the $528 billion of originations in the third quarter of last year, as well as a whopping year-over-year gain of 87.3%.

Historically low mortgage rates — and the refinance boom they propelled — fueled the big increase, the report indicated. The last time quarterly originations broke the $700 billion threshold was third-quarter 2007, while the previous post-recession peak of originations occurred in fourth-quarter 2016, when volume reached nearly $617 billion.

The spike in origination volume underscores the fact that 2019 was a tale of two halves for the mortgage industry. The first quarter of last year saw origination volume of only $344 billion, the smallest quarterly dollar volume since third-quarter 2014. Originations picked up steam as the year went on, however, with each quarter seeing a higher volume than the one before it.

For 2019 as a whole, mortgage originations stood at approximately $2.1 trillion, a 23% jump from the full-year volume of $1.7 trillion in 2018.

The report went on to note that the median credit score among newly originating mortgage borrowers also rose five points between the third and fourth quarters of 2019, ending the year at 770.

Total household debt increased by $193 billion to $14.15 trillion in the past fourth quarter, a 1.4% jump. It’s the 22nd consecutive quarter that total household debt has grown. Mortgage balances — which make up the largest component of household debt — grew to $9.56 trillion, an increase of $120 billion.


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