Purchase Locks Jumped YOY In April

Purchase mortgage lock counts rose year-over-year for the first since March 2022 in April, an encouraging sign in the tough homebuying environment.

Optimal Blue’s April 2024 Originations Market Monitor report revealed that purchase locks were up 5% YOY last month, the first increase since the Central Bank hiked rates two years ago.

Optimal Blue chalks the boost up to this year’s spring buying season. Total monthly rate locks rose 8.7%, driven by an 11% jump month-over-month.

“Purchase lock counts are a key market indicator as they control for changes in home prices and more volatile refi activity, so the year-over-year increase in April is a particularly encouraging sign that mortgage production may be turning a corner,” said Brennan O’Connell, director of data solutions at Optimal Blue.

“While we are cautiously optimistic, May figures will provide further confidence in the positive trend, as April 2024 numbers got a boost from the Easter holiday landing in March this year.”

Rates soared last month on less-than-ideal inflation data, pushing the cost of homeownership to unreachable levels for many Americans. As a result, nonconforming loan products, including jumbo and non-QM loans, increased their market share, while conforming, FHA and VA loans dwindled.

The average loan amount rose $7,200 to $374,500, while the average home purchase price increased to $14,100 to $477,900.

At the same time, refinancing activity slipped by 12% to lows last seen in the summer of 2023. Rate/term refinances tanked by 13.7%.

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