Local mortgage trend runs counter to U.S. data

Here’s another example of how relying on just national economic reports can be misleading about something as fundamental as real estate? A current loan application analysis is a prime example. ATTOM Data Solutions’ reports are a real estate industry standard. They’re indispensable for anyone who wants precise data on the economy. But like many other economic reports, you have to weigh the national data with what’s local for a complete picture.

ATTOM’s current mortgage lending report shows declines at an unusually fast pace during the third quarter. Nationwide loans applications were down 8% from the previous quarter – the largest quarterly dip in over a year.

Locally, there was a 1.2% dip in the Johnson City metro area, while Kingsport-Bristol saw a brisk 7.5% increase. Compared to Q3 last year, Kingsport-Bristol loan originations are up 20.8%. The Johnson City metro increased 11.6%. The U.S. year-over-year increase was 3%. If the common, “the local economy trails the national economy by a quarter,” holds true, look for declines in the Q4 data. But don’t depend on it. Real estate is hyper-local, and the “wait and see” advice doesn’t also materialize.

ATTOM’s analysis says, “The quarterly decline also was the second in a row and pointed to two unusual patterns developing the in the lending industry. It marks the first time in more than two years that total lending decreased in two consecutive quarters. More notably, it was the first time in any year since at least 2000 that lending activity declined both the second and third quarters, which usually are peak buying seasons.”

There was only one quarterly decline during those peak periods since 2019 in the Tri-Cities market. That decline was this year’s 1.2% Johnson City dip. There has been a decline in the second quarterly performance since the 2019 and 2020 double-digit peaks. This year’s increase dropped to single digits. That can be attributed to a combination of a local market slowly beginning to stabilize, lack of inventory, and some buyer fatigue.

Todd Teta

“The overflow stack of work that was hitting lenders for several years shrank again in the third quarter across the U.S. amid a few emerging trends,” said Todd Teta, chief product officer at ATTOM. “It looks more and more like homeowner’s voracious appetites for refinance deals has eased notably, while purchase lending also dipped. It’s still too early to say if the trends point to major shifts in lending patterns or the broader housing market boom. But the drop-off is significant, especially for home buying, which could suggest an impending housing market slowdown. We will be watching the lending trends extra closely in the coming months.”

Steve Reed

Local lenders are doing the same. Steve Reed, Benchmark Home Loans, says his firm’s numbers “were not quite as strong a year ago,” but still in a “very good year mode.” He qualified the comparison by pointing out that 2020 was such an atypical year; comparing it to this year is misleading. Compared to a more normal year like 2019 shows lenders are riding the lending wave of a very strong housing market.

According to ATTOM’s analysis, there were 4,533 new Tri-Cities loan originations during the third quarter. Refi applications still outnumber purchases but have plateaued while loan originations are increasing.


Tri-Cities loan applications total 2,242, up 0.1% from the previous quarter and up 33.1% from last year. Kingsport-Bristol accounted for 1,249 of those applications. That’s a 43.9% increase from last year. Johnson City metro originations are up 21.5% from last year.


There were 1,992 applicants for purchase loans in the region, up 6.2% from 2 and 26.8% higher than last year. Kingsport-Bristol dominated the purchase loans with 1,089. That’s a 21.5% increase from last year. The Johnson City metro accounted for 903 purchase loans, up 33.8% from last year, up 12% from Q2, and down 52.8% from last year.


The regional Q3 total was 299, The Johnson City metro area accounted for 112 of those loans, down 63.5% from last year. Kingsport-Bristol’s total was 187, down 42.6% from last year.

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Categories: REAL ESTATE

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  1. Nationwide Data analysis of the Housing Market