Mortgage Market Up 8 Percent in April

By Andy Meek

Sam Goff, a senior loan originator at Independent Bank, announced in a post to his Facebook followers last month that mortgage rates were at one point about as low as they’d been in 2014 so far.

That’s likely why more than one banker has said recently how home purchases far outnumber refinances in their business’ mortgage lending ratio, suspecting that most borrowers who’ve wanted to or been able to refinance perhaps have already done so. Indeed, the April numbers for Shelby County bear out a sense of optimism about purchase activity in the area.

New figures show total mortgage volume in the county was up 8 percent in April compared to April 2013, according to real estate information company Chandler Reports, www.chandlerreports.com.

Data for this report did not include refinances.

Volume in the county during April grew to a little more than $116 million last month from a little more than $108 million in April 2013. The number of mortgages made also grew, to 686 last month from 673 in April 2013. The average mortgage amount rose to $169,261 last month from $160,491 a year ago.

Last month’s 686 mortgages also marked a gain over the 611 filed in March. And April beat March’s average mortgage amount ($168,846) and total volume ($103.2 million).

BYRD

“After a relatively slow first few months of the year due to both weather and a slight increase in rates, the mortgage market is starting to improve in the second quarter,” said Bank of Bartlett chief financial officer Justin Byrd. “Home prices have improved significantly over the last year due to a limited inventory of homes for sale and overall improved customer credit quality.

“More individuals who were previously ‘under water’ on their mortgage now have equity, and that introduces a whole new tranche of potential purchasers to the market. We have already seen an increase in both the number and size of loans over the last two months and expect that trend to continue.”

In April, Bartlett Mortgage – a division of Bank of Bartlett – grew its loan volume 54 percent over April 2013, rising to a little more than $2.4 million from a little more than $1.5 million, according to the Chandler Reports numbers. Perhaps unsurprisingly, Shelby County home sales followed a similar pattern.

Home sales saw an increase in April, and those sales also were up sharply from March. Shelby County recorded 1,356 home sales in April, up 2 percent from the 1,335 homes sold in April 2013, according to Chandler Reports.

A variety of local financial institutions are upbeat about their mortgage prospects for the year. Triumph Bank, for example, said in its just-released annual report for 2013 that it expects Triumph Mortgage to have a “favorable impact” on 2014 earnings.

Triumph Mortgage is the name of the combined operation that includes Triumph and M&P Mortgage, which Triumph bought from Merchants & Planters Bank last year. Triumph’s new, combined mortgage volume will be more than 10 times the pre-acquisition volume, the bank has said.

Meanwhile, Trustmark National Bank Memphis region president Gene Henson said his bank has been adding staff to keep up with mortgage-related demand. Trustmark’s April mortgage volume in the Memphis area was a little more than $1.1 million, up 98 percent from April 2013.

During the first-quarter earnings presentation to analysts in April by the leadership of First Tennessee Bank’s parent company, First Horizon National Corp., chairman and CEO Bryan Jordan said he was “encouraged by the first quarter’s improving loan pipeline” despite pervasive caution among borrowers and a still unexciting economic recovery.

Several other local banks or banks with a local presence saw big mortgage gains in April. Iberiabank – which expanded its local residential mortgage lending team earlier this year – grew its volume for the month a whopping 134 percent, reaching almost $10 million last month, compared with a little more than $4 million in April 2013.

Patriot Bank, another of the big mortgage gainers over the two Aprils, grew its volume almost 50 percent to a little more than $9 million from a little more than $6 million a year ago.

Metropolitan Bank grew its mortgage volume during the same period from a little more than $2 million to almost $4 million. Likewise, Paragon Bank grew its volume from less than $400,000 in April 2013 to a little more than $2.5 million last month. And Independent Bank grew its volume from almost $780,000 to a little more than $1.4 million.

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