Black Knight: Home Prices Surge Nearly 18% Annually as May Sees Greatest Single-Month Acceleration on Record; eMBS Securities Issuance Data Suggests Borrower Behavior Changing in Response
On July 7, 2021, Black Knight, Inc. (NYSE:BKI) released its Mortgage Monitor Report, highlighting a remarkable 18% surge in home prices from the previous year. The report identifies low interest rates and limited inventory as driving factors, with a record monthly increase of 2.1% in May, the highest recorded. Homeowner equity reached an all-time high of $8.1 trillion, enhancing refinancing opportunities. The report indicates a shift in borrower behavior towards cash-out refinancing as homeowners seek to leverage increased equity amid competitive market conditions.
- Home prices surged 18% year-over-year, marking significant appreciation.
- Record monthly increase of 2.1% in home prices in May.
- Homeowner equity reached an all-time high of $8.1 trillion, increasing refinancing options.
- Cash-out refinances made up 42% of refinance loans, the highest in over two years.
- Drop in GNMA share of agency securitizations to below 25%, indicating potential market shifts.
- GNMA share of purchase lending decreased to below 40% for the first time.
- Increasing interest rates may reduce the attractiveness of cash-out refinances.
JACKSONVILLE, Fla., July 7, 2021 /PRNewswire/ -- Today, the Data & Analytics division of Black Knight, Inc. (NYSE:BKI) released its latest Mortgage Monitor Report, based upon the company's industry-leading mortgage, real estate and public records datasets. This month's report looks at the continued, unprecedented levels of home price growth, and the impact that growth is having on mortgage lending and borrower behavior. According to Black Knight Data & Analytics President Ben Graboske, home price appreciation continues to break records, with ramifications that stretch across the real estate and mortgage markets.
"The Black Knight HPI shows home prices in May up nearly
"Indeed, the rate of growth has been accelerating by more than
"The impacts are widespread as well. Obviously, as home values increase, so do levels of available, tappable equity, which hit an all-time high of
"Back then, GNMA securities – comprised primarily of FHA and VA loans – made up about a third of agency securitizations; today they're less than
The report also found that, with tappable equity at record highs and interest rates remaining relatively low, cash-outs are starting to make up a larger share of refinance lending, especially with rate/term refis on the decline. Nearly half of all tappable equity – the amount available to a homeowner with a mortgage to borrow against before hitting a maximum
About the Mortgage Monitor
The Data & Analytics division of Black Knight manages the nation's leading repository of loan-level residential mortgage data and performance information covering the majority of the overall market, including tens of millions of loans across the spectrum of credit products and more than 160 million historical records. The combined insight of the Black Knight HPI and Collateral Analytics' home price and real estate data provides one of the most complete, accurate and timely measures of home prices available, covering
Black Knight's research experts carefully analyze this data to produce a summary supplemented by dozens of charts and graphs that reflect trend and point-in-time observations for the monthly Mortgage Monitor Report. To review the full report, visit: https://www.blackknightinc.com/data-reports/
About Black Knight
Black Knight, Inc. (NYSE:BKI) is an award-winning software, data and analytics company that drives innovation in the mortgage lending and servicing and real estate industries, as well as the capital and secondary markets. Businesses leverage our robust, integrated solutions across the entire homeownership life cycle to help retain existing customers, gain new customers, mitigate risk and operate more effectively.
Our clients rely on our proven, comprehensive, scalable products and our unwavering commitment to delivering superior client support to achieve their strategic goals and better serving their customers. For more information on Black Knight, please visit www.blackknightinc.com/.
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SOURCE Black Knight, Inc.
FAQ
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