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VOL. 132 | NO. 10 | Friday, January 13, 2017

Local Mortgage Market Closes Out Strong 2016

By Andy Meek

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Sam Goff, vice president of Independent Bank’s mortgage division, was already upbeat about the Memphis-area mortgage market as 2016 was only just getting under way.

But phones were already ringing even then, he enthused to a reporter. The bank had a pipeline stuffed with prospects. 2016 was “setting up to be a great year.”

The latest numbers, out now and covering mortgage activity for the year, suggest he was on the mark.

Total purchase mortgage volume in Shelby County was up 16 percent in 2016, according to real estate information company Chandler Reports, chandlerreports.com.

Volume topped $1.9 billion for the year, up from a little more than $1.6 billion during 2015, which itself represented a healthy gain over the more than $1.4 billion in 2014.


Mortgage volume was up 20 percent in December.

Volume climbed to $166.2 million in December 2016 from $138.5 million in December 2015, according to Chandler Reports. 

The number of mortgages made during the month was up by nearly the same percentage. Banks and lenders made 17 percent more mortgages during the last month of 2016 than they did in December 2015. That number climbed from 794 to 929.

The average dollar amount of those mortgages climbed only slightly. From December 2015 to December 2016, that figure rose from $174,474 to $179,000.

A few things are going on behind the scenes from a macro-economic perspective that are helping power these trends. 

While it’s not as current, data released by the Federal Reserve in recent days shows that American consumer balance sheets are expanding at a steady clip. In November, ccording to the Fed, consumer credit increased at a seasonally adjusted annual rate of 8 percent.

According to Chris Low – chief economist at FTN Financial, a division of First Tennessee Bank – average hourly earnings are on the rise. That also gives consumers something of a psychological lift, in terms of expanding their appetite for borrowing.

Bankers throughout the year also pointed to recurring trends – like continued low interest rates and a resurgent economy – as helping convince borrowers to come off the sidelines and put themselves into the market for a new home.

Jessica Campbell, a mortgage loan officer at BankTennessee, gave a mirror image of Goff’s assessment at year’s end. After banks had closed the book on December, she pointed to a strong 2016 overall – and an atypically busy fourth quarter.

“While rates ticked up at the end of the year and the holidays typically slow down the mortgage market, we continued to see an increase in new loan requests,” she said. “In fact, 2016 was a record year. We attribute the success to our team as well as our customers who have sent us a number of referrals.”

Among other mortgage-related highlights for the year:

• Banks and lenders made 10,655 mortgages in Shelby County during 2016, up 14 percent from the 9,364 during 2015, according to Chandler Reports.

• Borrowers are also taking out bigger mortgages. The average mortgage amount in 2016 topped $180,000 – $180,113, to be exact – up nearly 6 percent from a little more than $176,000 in 2015.

• The top lenders also all saw at least double-digit percentage gains in their volume production over 2016. (See info box for details on 2016’s top lenders.)

• Meanwhile, the local mortgage market just also closed out a strong fourth quarter, with volume reaching $488 million, up 27 percent from more than $383 million in Q4 2015.

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

PROPERTY SALES 27 150 2,415
MORTGAGES 57 228 2,835
BUILDING PERMITS 157 441 6,509
BANKRUPTCIES 61 133 1,920