Reverse mortgage volume started 2016 well-below year-ago levels in both 2015 and 2014. But as the industry continues its recovery from the biggest program changes it has seen in recent years, that volume gap is starting to close.
Compared to last year, Home Equity Conversion Mortgage endorsements began 2016 with 3,890 loans, approximately 21% lower than January 2015, according to industry data tracked by Reverse Market Insight (RMI). The following month, a nearly 18% jump in volume brought the total endorsement count for February just 3.5% lower than its 2015 level.
March endorsement data, which reported just a 1% decrease from February’s numbers, helped compress the year-over-year gap even smaller. On a year-ago basis, March’s 4,535 loans are now just 2.3% lower than where they were in March 2015.
“HECM endorsements have been lower than 2014 and 2015 for each of the first two months (and March will continue that pattern), but the gap is at least narrowing,” writes RMI in its HECM Trends report for February 2016 released Wednesday. “That makes year over year comparisons a little rosier, particularly if we drill into some of the warmer markets as Spring thaws more of the country.”
Source: Reverse Market Insight
While most of the top-10 states for volume are trending lower endorsements year-to-date through February 2016, some have been seeing notable growth this year so far.
With 318 units year-to-date, Colorado is up 45.9% through February. The state, which has the highest growth among the top-10, is propelled by Denver, whose 58 units signal a 47.4% increase compared to last year.
Washington state is also up 20.9% compared to last year’s numbers with 237 units through February—enough to tie North Carolina in terms of unit count as the seventh largest state for volume.
RMI also highlighted two adjacent zip codes in St. George, Utah, both of which made the top-10 list nationally. Even more impressive, RMI notes, is that 29 of the area’s 45 loans were HECM for Purchase loans.
View the RMI data.
Written by Jason Oliva