Black Knight released their Mortgage Monitor report for November today. According to Black Knight, 3.71% of mortgages were delinquent in November, down from 4.55% in November 2017. Black Knight also reported that 0.52% of mortgages were in the foreclosure process, down from 0.66% a year ago.



This gives a total of 4.23% delinquent or in foreclosure.



Press Release: Black Knight: 550,000 Homeowners Regain Incentive to Refinance as Interest Rates Fall Slightly; Refinanceable Population Still Down Nearly 50 Percent from Last Year



Today, the Data & Analytics division of Black Knight, Inc. (NYSE:BKI) released its latest Mortgage Monitor Report, based upon its industry-leading loan-level mortgage performance database. As mortgage interest rates have dropped from multi-year highs in recent weeks, the number of homeowners with mortgages who could likely qualify for and see at least a 0.75 percent interest rate reduction by refinancing has increased by approximately 550,000. Ben Graboske, executive vice president of Black Knight’s Data & Analytics division, explained that although this number represents a relatively small share of outstanding mortgages, it is a sizeable increase from recent lows in the size of the refinanceable population.



“As recently as last month, the size of the refinanceable population fell to a 10-year low as interest rates hit multi-year highs,” said Graboske. “Rates have since pulled back, with the 30-year fixed rate falling to 4.55 percent as of the end of December. As a result, some 550,000 homeowners with mortgages who would not benefit from refinancing have now seen their interest rate incentive to refinance return. Even so, at 2.43 million, the refinanceable population is still down nearly 50 percent from last year. Still, the increase does represent a 29 percent rise from that 10-year low, which may provide some solace to a refinance market still reeling from multiple quarters of historically low – and declining – volumes.



“In fact, through the third quarter of 2018, refinances made up just 36 percent of mortgage originations, an 18-year low. And of course, as refinances decline, the purchase share of the market rises correspondingly. So now, in the most purchase-dominant market we’ve seen this century, we need to ask whether the shift in originations will have any impact on mortgage performance. The short answer, based on historical trends, is that it certainly bears close watching. Refinances have tended to perform significantly better than purchase mortgages in recent years. When we take a look back and apply today’s blend of originations to prior vintages, the impact becomes clear. A market blend matching today's would have resulted in an increase in the number of non-current mortgages by anywhere from two percent in 2017 to more than a 30 percent rise in 2012, when refinances made up more than 70 percent of all lending. As today’s market shifts to a purchase-heavy blend of lending, Black Knight will continue to keep a close eye on the data for signs of how – or if – this impacts mortgage performance moving forward.”



Leveraging the latest data from the Black Knight Home Price Index, the report also finds that flattening home price growth over the last four months has led to the slowest annual appreciation rates in nearly three years.

emphasis added

Click on graph for larger image.

• Home prices were effectively flat M/M (+0.01%) in October, and in fact had been so over the prior four months (+0.01%)



• While fall and winter are typically slow times of the year for home price growth, this is the most tepid 4-month stretch of growth in nearly four years



• Annual home price gains continue to slow, decelerating by 1.3% over the past 8 months, from a 4-year high of 6.7% in February to 5.4% Y/Y in October and slowing rapidly

• Additional near-term pressure may be on the way as affordability hit a new low point as interest rates rose to 4.87% on average in November



• Rates have since pulled back noticeably in December, bringing the average monthly payment to buy the average-priced home down $46 from November's 11-year high



• Even with December's pullback, it still takes $141 more per month (+13%) in principal and interest (assuming 20% down) to purchase the average home than 12 months ago

Here is a graph from the Mortgage Monitor that compares Black Knight's estimate of home price appreciation and 30 year mortgage rates.From Black Knight:There is much more in the mortgage monitor.