Let's talk about mortgages!
Total mortgage issuance has been hot over the past three years as mortgage rates fell to all-time lows in 2021. Each of the past ten quarters has had greater mortgage originations than every quarter since Q2 2013.
The average 30-year mortgage rate climbed to over 6% this week. Over the past year, there has been a slowing in overall mortgage issuance, but levels are still high relative to recent history.
Naturally, there are concerns for the health of the housing market going forward, but the overall quality of borrows has dramatically increased since the Great Financial Crisis of 2008 and 2009.
Hopes are that the housing market is more insulated against severe losses as borrowers are of higher quality and less prone to default on mortgage payments or enter foreclosure.
Source: Helios Quantitative Research, Bloomberg