November 2021 Originations Market Monitor

Rate Locks Down 4.7% Overall in November; Rate/Term Refi Originations 65% Below Last Year’s Level

Rate lock volumes fell across the board in November, driven by rate/term refinance originations dropping another 9.4% for a nearly 65% year-over-year decline
November marked the third consecutive monthly decline in overall origination volume, bringing it to its lowest level since February 2020, prior to the onset of the pandemic
While locks on both purchase (-3.9%) and cash-out refinance (-2.5%) loans fell from October, they remain nearly 13% and 36% above last year’s levels
Black Knight’s OBMMI daily interest rate tracker recorded a volatile month for rates as the market digested concerns of both the Fed tapering announcement as well as the impact of the new COVID-19 Omicron variant
While reaching as high as 3.36%, by month’s end the average 30-year conforming rate offering stood flat from October at 3.27%
Non-conforming jumbo loan products continued to gain market share at the expense of agency volumes in advance of higher conforming loan limits announced by the FHFA taking effect at the start of 2022

JACKSONVILLE, Fla. – Dec. 13, 2021 – Today, Black Knight, Inc. (NYSE:BKI) announced the release of its latest Originations Market Monitor report, looking at mortgage origination data through November 2021 month-end. Leveraging daily rate lock data from Black Knight’s Optimal Blue PPE – mortgage lending’s most widely used pricing engine – the Originations Market Monitor provides the industry’s earliest and most comprehensive view of origination activity.

“While 30-year rates ended November relatively flat from where they were at the start of the month, there was some volatility in rate offerings throughout the month,” said Black Knight Secondary Marketing Technologies President Scott Happ. “Rates moved up and down within a roughly 21 basis point range throughout the month as the market digested news of both the Fed’s tapering announcement and the new Omicron variant. Indeed, our OBMMI daily interest rate tracker showed average offerings reaching as high as 3.36% in the week leading up to Thanksgiving before settling.”

The month’s pipeline data showed overall rate locks down 4.7% from October, driven by a 9.4% drop in rate/term origination activity. While this was the third consecutive monthly decline, rate/term refinance lending has actually fallen in eight of the 11 months of 2021 thus far and is now down 65% from last November’s level. The overall refinance share of the market mix remained at 45%, the lowest it’s been since June 2021. Locks declined across the board, with cash-out refinances down 2.5% and purchase loans down 3.9%. Despite the monthly decline, cash-out lock volumes are still up nearly 36% from this time last year and continue to be buoyed by ongoing home price growth.

“While the rate of home price growth has slowed, it is still historically quite robust,” Happ continued. “As a result, we continue to see non-conforming jumbo loan products gain market share at the expense of agency volumes. With higher conforming loan limits announced by the FHFA taking effect at the start of 2022, it will be interesting to see to what degree this trend persists. As it is, the average loan amount rose another $7,000 to reach $337,000 in November.”

Each month’s Originations Market Monitor provides high-level origination metrics for the U.S. and the top 20 metropolitan statistical areas by share of total origination volume.

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 serve their customers. For more information on Black Knight, please visit www.blackknightinc.com.