31 Mar

PCRG’s 20th Annual Mortgage Lending Study is complete! This year’s study looks back at all residential mortgage lending in Allegheny County from 2005 to 2012. Allegheny County saw a decline in total number of mortgage loans of more than 40% between 2005 and 2008, when the market bottomed out. The overall market has improved substantially since then, with the total number of loans in 2012 back to 86% of the 2005 level. However, the 2012 mix of loan types and the communities receiving them looked very different from the 2005 mix.  The resurgence of lending has been driven by refinancing of existing loans rather than new home purchases, and has taken place primarily in majority white and middle- and upper-income Census tracts.

Substantially minority Census tracts (those with over 50% minority population) and low- and moderate- income (LMI) Census tracts only started their recovery in the mortgage market in 2012 and remain at less than 60% of the lending levels of 2005-2006. Home purchase loans make up a much smaller portion of the total mix, at 60% of the 2005 level.  Refinancing loans were actually up 13% compared to 2005, driven by extremely low interest rates beginning in 2009.  Reports from 2013 are showing that the surge in refinancing has peaked and levels are dropping, now that most of those able to take advantage of low interest rates to refinance their mortgage loans have already done so.

The landscape of lenders has changed substantially since 2005, as some national lenders have either disappeared or contracted their lending.  The number of loans made by banks with branches in Allegheny County increased 21% between 2005 and 2012, while the number of loans by other institutions decreased by 34%.  PCRG welcomes the increase in local lending, as we continue to meet with banks in our region and discuss ways for them to increase their lending and investment and improve their services in LMI and minority communities.

The complete mortgage lending study is available on PCRG’s website.  Hard copies are being printed and will soon be available to all PCRG members and partners.

If you have any questions or comments on PCRG’s 20th Annual Mortgage Lending Study, please contact Rachel Rue, PCRG’s Research Analyst, at rrue@pcrg.org or (412) 391-6732 ext. 211.

Rachel Rue

Research Analyst at Pittsburgh Community Reinvestment Group
Rachel works on banking research and policy and is responsible for PCRG's annual Mortgage Lending Study. She has worked as a researcher and writer in diverse fields, from mortgage finance to cyber security to philosophy. Rachel is a resident of Lawrenceville and flutist in an accordion/flute duo and the Pittsburgh Mandolin Orchestra. She holds an MS in Algorithms, Combinatorics, and Optimization from Carnegie Mellon University and a PhD in Philosophy from Princeton.