Purchase mortgage originations dropped 19% in Q1 2026, the lowest quarterly level since 2014, ATTOM data shows
American home purchase lending tumbled to its lowest quarterly total in more than a decade during the first three months of 2026 as elevated home prices and climbing mortgage rates shut out buyers across most of the country.
ATTOM, a property data and real estate analytics provider, reported that total residential mortgage originations fell 13% quarter-over-quarter to 1.57 million loans in Q1 2026, with dollar volume slipping 12% to $577.7 billion.
On an annual basis, originations were still up 5%, and dollar volume rose 15% from a year earlier, but the quarterly trajectory told a more cautious story.
Purchase loans led the decline, dropping 19% from Q4 2025 to 581,261, the lowest quarterly figure since Q1 2014.
Dollar volume for purchase lending fell to $236.8 billion, down 18% from the prior quarter and 8% below year-ago levels.
Purchase loans accounted for 37% of all residential originations, down from 40% in Q4 2025 and 44% a year earlier.
"Purchase, refinancing and home-equity lending all posted declines from the previous quarter, continuing a seasonal trend we've seen during the start of the year over the past four years," said Rob Barber, CEO of ATTOM.
"However, purchase activity stood out with home-buying loans falling to a 12-year low, as elevated home prices and higher mortgage rates continued to strain affordability for many buyers."
Purchase activity fell in 99% of the 200 metropolitan statistical areas ATTOM analyzed.
The sharpest quarterly drops among large markets were in St. Louis, MO; Rochester, NY; Honolulu, HI; Boston, MA; and Pittsburgh, PA. Only Yuma, AZ (up 28.6%) and Tucson, AZ (up 5.9%) recorded gains.
The broader lending contraction was similarly widespread, with total originations declining in 96.5% of all analyzed metros.
Refinancing and HELOC volumes also slip
Refinancing originations fell 7% quarter-over-quarter to 715,818 loans, though volumes held 24% above Q1 2025.
Refis represented 45.6% of all residential lending, up from 42.7% the previous quarter, as softening purchase demand shifted the origination mix.
Read more: Refinance applications hit lowest share since June 2025 as rates climb
FHA loan share dropped to 9.6% of all residential originations, its lowest in nearly five years, while VA-backed loans held at 7.4%.
Home equity line of credit originations declined to 272,156, down 12% from Q4 2025 but 4% above year-earlier levels.
Mortgage rates compounded the pressure throughout the quarter. According to Freddie Mac, the average rate on a 30-year fixed mortgage rose from 6.15% in January 2026 to 6.46% by early April 2026, adding further strain to an already affordability-constrained market.
Brokers feel the slowdown on the ground
Jaime Rhude, a loan officer with CrossCountry Mortgage based in Florida, says borrower conversations have shifted markedly heading into summer 2026, shaped by geopolitical uncertainty, stubborn inflation, and an unsettled outlook at the Federal Reserve.
"Rates are making an impact," Rhude told Mortgage Professional America. "Applications slowed down for a couple of weeks. I've noticed that trend where it's not as busy as it was last month."
Data from the Mortgage Bankers Association's (MBA) Builder Application Survey showed applications for new home purchases dropped 2.4% compared with April 2025.
Month over month, volumes fell 10% from March, though the MBA noted that figure carries no seasonal adjustment.
"Ongoing economic uncertainty and higher mortgage rates contributed to lower purchase activity for newly built homes in April," said Joel Kan, MBA's vice president and deputy chief economist.
"Applications to purchase new homes fell below last year's pace, the first year-over-year decline since October 2025."
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