Refinances Dominated Freddie Mac January Volume

Freddie Mac reported this week that its total mortgage portfolio increased at an annualized rate of 4.3 percent in January, a substantial change from the 15.2 percent gain in December.  The portfolio balance at the end of the period was $2.339 trillion compared to $2.331 trillion at the end of December and $2.184 trillion a year earlier. The growth rate for the year to date is 4.3 percent compared to 1.2 percent for the same period in 2019.

Purchases and Issuances totaled $47,606 billion and Sales were ($.253) billion. The December numbers were $65.799 billion and ($.780) billion respectively. 

Single-family refinance loan purchase and guarantee volume was $25.800 billion in January compared to $30.500 billion in December and representing a 57 percent share of total single-family mortgage portfolio purchases and issuances compared to 56 percent the previous month.

Purchases in Freddie Mac's Mortgage Related Investments Portfolio totaled $27.516 billion for the month compared to $43.389 billion in December. Liquidations were ($2.665) billion and ($2.875) billion for January and December respectively and Sales for the two periods were ($35.350) and ($32.385) billion. The ending balance in the portfolio was $202.175 billion about $10.500 billion less than in December.

The Mortgage Related Investments Portfolio's annualized growth rate turned negative again in January after posting the first growth in three months, a 47.7 percent increase, in December. The January growth was (59.2) percent. The annualized growth in January 2019 was 4.6 percent.

The ending balance of the Mortgage Related Investments Portfolio was composed of $115.264 billion in Mortgage Related Securities, Mortgage Loans valued at $76.901 billion, Non-Agency, non-Freddie Mac Mortgage-Related Securities at $1.582 billion; and Agency non-Freddie Mac Mortgage related securities of $8.428 billion. Mortgage related securities and other guarantee commitments increased at an annualized rate of 8.3 percent compared to 12.0 percent the previous month.

Freddie Mac's single-family delinquency rate dropped 3 basis points to 0.60. This is a decline of 10 basis points on an annual basis. The rate for credit-enhanced Primary Mortgage Insurance loans dipped 1 basis point to 0.78 percent while the non-credit portion notched down 3 basis points to 0.67 percent. The multi-family delinquency rate was 0.08 percent, unchanged from December but up 0.07 point since last January.

Freddie Mac said the measure of its exposure to changes in portfolio value averaged $3 million in January, down from $5 million in December.