Mortgage lending surged last year after the pandemic fueled a housing boom driven by low interest rates and the shift to work from home, according to information released Thursday by the Federal Reserve.
The annual release of data under the Home Mortgage Disclosure Act also showed the share of home purchase loans given to Black borrowers rose last year and the share made to Hispanic and Asian borrowers declined slightly.
Mortgage originations increased by about 5.3 million in 2020 from 2019, a rise of 67.1%. Mortgage refinancing for properties that house one to four families soared by 150% while home purchase loans increased by 6.7%.
Black borrowers received 7.3% of home purchase loans in 2020, up from 7.0% in 2019. The share of loans made to Hispanic-White borrowers decreased slightly to 9.1% from 9.2%, and those made to Asian borrowers decreased to 5.5% from 5.7%.
The share of home purchase loans made to low- or moderate-income borrowers increased to 30.4% from 28.6%. The report is based on data provided by 4,475 banks, credit unions and other mortgage lenders.
The U.S. housing market outperformed last year even as the broader economy was devastated by the coronavirus pandemic, which led to widespread business shutdowns and left millions of Americans unemployed. Demand for vacation homes was especially strong, driven largely by people who shifted to working remotely and virtual schooling.
However, rising home prices and a limited supply of homes on the market are restraining growth and causing some forecasters to lower their projections for future home sales.