NWA mortgage activity continues to decline

According to Attom Data Solutions, despite the region’s hot housing market, residential mortgage lending in Northwest Arkansas continues to decline.

The California company, which tracks national housing and foreclosure data, issued its fourth-quarter mortgage report on March 3. It shows that lenders originated 6,560 mortgages secured by residential properties in the Northwest Arkansas metropolitan statistical area (MSA) during the last three months of 2021. That includes all three categories of conventional loans — purchasing, refinancing and home equity.

The fourth-quarter total is down 2.2% from the July to September period and a 12.3% decline from the fourth quarter of 2020. It’s the region’s fifth consecutive quarterly drop since the third quarter of 2020 (7,537).

Refinance loans in Northwest Arkansas (3,380) were down 17.2% from the fourth quarter of 2020.

AMC Mortgage in Tulsa, Okla., has a Northwest Arkansas branch in Rogers managed by Katelyn Huddleston. She explained that the decline in mortgage activity was a natural reaction to various factors in 2020.

“Mortgage interest rates dropped [in 2020], and people began capitalizing on that and refinanced their homes,” she said. “Through COVID-19 quarantine, people were stuck at home and decided they wanted something else or something different. The realization that work from home could be a permanent option drove people to buy other housing. So, 2020 was a flurry of mortgage activity for different reasons, and it continued to 2021. We are now coming off of that. Rates are trending up, people have already refinanced, and many homeowners bought or upgraded their homes over the past two years. It makes sense to see things slowing down.

“Homeownership is here to stay, though, and Arkansas continues to be a place people want to live.”

There were 7,588 loan originations in central Arkansas during the fourth quarter last year, a quarterly dip of 4% and a 3.6% year-over-year decrease. There were 2,020 loans in the fourth quarter in the Fort Smith metro. That’s a 9.3% quarterly decline and a 2.2% decrease from a year ago.

Nationally, Attom reports that lenders originated 3.27 million mortgages secured by residential property in the fourth quarter of 2021. That total was down 11% from the previous quarter and 13% from the fourth quarter of 2020.

Overall, lenders issued $1.06 trillion worth of mortgages in the fourth quarter of 2021. That was down quarterly by 9% and annually by 7%. According to Attom, both decreases in the dollar volume of loans were the largest since early 2019.