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VOL. 126 | NO. 243 | Wednesday, December 14, 2011

Mortgages Up 15 Percent in November

By Andy Meek

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As families across Shelby County last month made turkey dinners and took note of things they’re thankful for, the area’s mortgage bankers no doubt found reason to be grateful for some positive industry news.

The area’s mortgage market saw a 15 percent increase in November compared with the same month in 2010, as more homeowners eased back into the market.

Mortgage volume topped $86 million in November, up from $74.9 million in November 2010, according to real estate information company Chandler Reports, www.chandlerreports.com.

The trend wasn’t confined to November. That month also represented the fifth straight month showing year-over-year improvement in the county’s home sales, with an 18 percent increase (1,025 homes in November 2011, up from 871 in November 2010).

In terms of mortgages, lenders made more mortgages during the month of November than they did in November 2010, although those mortgages saw a slight dip in their average dollar amount.

The number of mortgages saw a bump from 489 in November 2010 to 565 last month, a nearly 16 percent increase. The average mortgage amount also saw a small drop, from $153,360 in November 2010 to $152,888 a year later.

The top five lenders for November represented more than one-third of the month’s entire mortgage volume. Between them, Community Mortgage Corp., Magna Bank, Wells Fargo, Patriot Bank and Regions Bank saw a little more than $30 million in total volume for the month.

Community Mortgage Corp. was the most active lender, with a volume of about $13 million.

“You have to keep in mind a couple of things,” said Dean Puryear, vice president and mortgage production manager for Memphis with Regions Mortgage. “One is last year we had the expiration of the tax credit, which was an incentive for people to purchase. That’s one thing.

“I think the other piece to it is we’ve got into more of a consistent purchase money market, from what I can tell.”

Regions increased its mortgage volume in Shelby County slightly from $3.5 million in November 2010 to $3.6 million last month.

It should be noted, however, that it’s not positive news all the way around.

Although its dollar amount was up between the two November periods ($7.6 million in 2010 to $8.2 million a year later), Magna only made one additional loan this November than it did in the same month a year ago (41, up from 40).

The bank also said in its most recent Form 10Q regulatory filing that it anticipates additional staff reductions related to a mortgage slowdown.

The bank’s mortgage origination volume dropped from $114.5 million in the third quarter of 2010 to $74.2 million in Q3 this year.

“Because of the volatile nature of the mortgage origination business and weakness in the national economy (particularly the housing market), it is difficult to project mortgage origination volumes for the remainder of 2011,” the bank wrote in its regulatory filing. “However, we expect residential mortgage origination volumes in 2011 and 2012 to be significantly less than 2010’s volume. As a result, we have aggressively cut staff in our mortgage division and expect further staff reductions by yearend.”

Chandler Reports is a division of The Daily News Publishing Co. Inc.

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RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 72 368 16,413
MORTGAGES 66 422 21,432
FORECLOSURE NOTICES 15 76 4,266
BUILDING PERMITS 176 877 39,378
BANKRUPTCIES 60 294 15,542
BUSINESS LICENSES 20 98 5,491
UTILITY CONNECTIONS 69 423 23,573
MARRIAGE LICENSES 17 95 5,035

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