A surge in Tri-Cities refi loan originations may not bode well for the long-term existing home sales market. Driven by record-low mortgage rate, refi loan originations were 78.5% higher in the Johnson City MSA higher during the last three months of 2019 than there were during the first quarter and 75.7% higher in the Kingsport-Bristol MSA. During the year, there were a little more than 4,000 refi originations. That’s almost as many as purchase loan originations. The increasing number of owners refinancing can be seen as lowering the potential number of homes going on the market for years to come. The current average time an owner lives in his or her home before trading up or scaling down is almost 10 years. Barring some amazing deal or other circumstances, owners who refinance now are not going to be inclined to go to the market anytime in the near term. That would be balanced if the region was seeing strong population growth. But that’s not the case.
Categories: REAL ESTATE