Home loan payoffs drop to 3 year low
The number of home loans being paid off in Mesa County has dropped to its lowest level in more than three years, a result of increasing mortgage rates and a sign that the rebound in the local housing market has moderated.
The Mesa County public trustee released 1,155 deeds of trust in the first quarter of this year, a 54 percent drop from the 2,529 deeds released in the first quarter of 2013, according to a new report released Thursday by the Colorado Division of Housing. It was the fewest deeds released since the third quarter of 2010, when 804 deeds were released, Division of Housing spokesman Ryan McMaken said.
For the 21 counties surveyed in Colorado, the number of deeds released plunged to 50,128, 49 percent less than the first quarter of last year and the lowest quarterly total since the state began tracking that data in 2008.
Public trustees release deeds of trust when homeowners pay off their mortgages by selling, refinancing or making their final payment.
“We expected release activity to go down because we expected (refinances) to go down when mortgage rates went up,” McMaken said. “I think maybe we didn’t expect the numbers to go down this much.”
Mortgage rates are still low compared to 2008, but they’ve gone up significantly since 2012, McMaken said. That makes it tougher for people to finance or refinance.
The average 30-year fixed mortgage rate is 4.43 percent this week, compared with 3.66 percent in 2012 and 6.03 percent in 2008, according to Freddie Mac.
The largest decreases in releases were in Boulder and Broomfield counties, where releases fell 59 and 62 percent, respectively. Eagle and Alamosa counties reported the smallest decreases in release activity at 21 and 31 percent, respectively.
In Delta County, the only other county in the region that was included in the report, quarter-to-quarter releases fell 56 percent, from 382 to 169.
The Division of Housing report was based on surveys in 21 counties, where more than 90 percent of all households are located.
McMaken said he believes the dropoff in deed releases will moderate the rest of the year.
“Things will start to flatten out and I don’t expect a big change in either direction at this point,” he said.