Despite the downturn in Home Equity Conversion Mortgage endorsement volume in February, largely attributable to program changes implemented in October 2017, several areas saw substantial year-over-year growth during the first two months of combined data in 2018. Those areas, Seattle and Portland, have outpaced the national 27.9% increase in year-over-year volume for January and February combined, according to data released this week from Reverse Market Insight.
In January and February 2018, Seattle rose more than 112% in loan volume, to 87 loans during the two-month period. Likewise, Oregon as a whole has increased nearly 107% in volume during that period, to 360 loans total, driven in part by the Portland area, with a 75% year-over-year increase for January and February combined.
There is still an anticipated drop-off mirroring the national averages for these local hot spots, RMI’s President John Lunde tells RMD. The hot spots could be driven by a relatively larger surge of applications prior to the program changes versus the national surge, and originators in the Oregon market report a substantial marketing campaign targeted on the area. Likewise, home value appreciation has been strong in both markets.
According to the S&P CoreLogic CS Home Price Index, home prices rose 6.3% year over year in February. Among the top 20 metros tracked by the index, Seattle took the top position with more than 12% gained in home values year-over-year, while Portland, Oregon gained 6.7% over the same time period, ranking No. 9 among the top 20 metros.
The RMI data on relative hot spots comes on the heels of a more-than 17% decline in volume reported in February endorsements.
Written by Elizabeth Ecker