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VOL. 130 | NO. 70 | Friday, April 10, 2015

Shelby County Mortgage Market Grows 23 Percent in March

By Andy Meek

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The last month of the first quarter showcased a Shelby County mortgage market with abundant vitality, including evidence that plenty of demand exists among buyers eager to sign on the dotted line.

Mortgage volume countywide grew 23 percent in March compared to the same month a year ago, according to real estate information company Chandler Reports, www.chandlerreports.com. Year over year, volume last month rose to a little more than $126 million, up from $103.1 million in March 2014, and lenders say continued low rates are one reason why.

There’s also an expectation the surge in activity will continue at least for the near future, as the market transitions from the spring to summer months when conditions are even more favorable among buyers looking for a new home.

BankTennessee president and CEO Jim Rout, for example, said his bank right now sees a market fueled by an increase in purchase activity – with a corresponding drop in refinances – as well as an uptick in for-sale-by-owner transactions. More broadly, Rout continued, some of that activity is being fueled by things like an improving economy and parents helping children with down payments, all of which is occurring against the backdrop of property values that are on the rise in many cases.

Digging into the mortgage-related metrics for March, the number of mortgages saw an improvement year over year, with 729 last month compared with 611 in March 2014. The average mortgage amount likewise saw improvement, to $173,397 last month from $168,846 last year.

“As rates continue to remain low and the economy improves, we’re seeing buyers start to move from starter homes to larger residences.”

–Scott Stafford
Evolve Bank & Trust

Not surprisingly, the mortgage growth corresponded to improvement in home sales, as well.

Shelby County saw 1,293 homes sold in March, up 8.4 percent from 1,193 homes sold in March 2014, according to Chandler Reports. Prices rose, too, with the average sales price of a home in March hitting $143,371, up 2.1 percent from $140,366 in March 2014.

“We continue to see a strong purchase market as rates continue to fluctuate between the 3.75 percent and 4 percent range,” said Scott Stafford, president and CEO of Evolve Bank & Trust. “As rates continue to remain low and the economy improves, we’re seeing buyers start to move from starter homes to larger residences. Home purchases are close to 2001 levels, and we expect demand to continue to increase as we move into the spring and summer months.”

Mortgage market improvement looks even more pronounced when considering the change not just between the two March periods, but when looking at the period between February of this year and March.

Last month’s 729 mortgages were up from 464 in February, a month that also saw lower volume ($78.4 million in February, compared to volume of a little more than $126.4 million in March).

The average mortgage amount also rose from February to March, going from $168,933 to $173,397, according to Chandler Reports.

Among local lenders who saw gains in March, Orion Federal Credit Union saw its volume improve from $137,000 in March 2014 to $275,500 last month. Likewise for BankTennessee, which rose from a volume of $156,874 to $375,000 over the two March periods, according to Chandler Reports.

Commercial Bank & Trust’s growth in volume was similarly heady, up from $419,254 in March 2014 to $832,200 last month. Beating everyone on volume for the month was Community Mortgage Corp., with a March volume of almost $11 million, blowing past the volume of a little more than $6 million it recorded one year earlier.

Close on the heels of Community Mortgage Corp. was Magna Bank, with a volume of $10.7 million in March, up from a little more than $8 million one year earlier.

Looking at other local gainers, Financial Federal grew its volume from $4.3 million in March 2014 to a little more than $7 million last month. Bartlett Mortgage was also up during that period (from a little more than $1 million to $4.3 million), as was volume at Triumph Mortgage (from $1.9 million to almost $3.3 million).

Also seeing a big month in March were First Tennessee Bank, which saw volume increase from almost $520,000 to almost $3 million year over year, and Paragon Bank, which grew its volume from $1.7 million to $2.3 million.

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

RECORD TOTALS DAY WEEK YEAR
PROPERTY SALES 64 87 1,429
MORTGAGES 39 60 1,107
FORECLOSURE NOTICES 7 13 203
BUILDING PERMITS 92 209 3,265
BANKRUPTCIES 42 84 837
BUSINESS LICENSES 21 23 352
UTILITY CONNECTIONS 0 0 0
MARRIAGE LICENSES 0 0 0