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Before President Donald Trump set off fears of a financial crisis with his broad international tariffs last week, it seemed like homebuyer demand was on the upswing in the Boston area.
According to a new report from Optimal Blue, rate lock volume is trending upwards nationally and in the Boston area.
Nationally, a 52 percent increase in rate-and-term refinancing locks during March drove a 24 percent overall increase in mortgage lock volume on a year-over-year basis. In Greater Boston, there was a 38.4 percent increase in origination volume in March, compared to a 34 percent month-on-month increase in March 2024.
“March brought a notable shift in borrower behavior,” Brennan O’Connell, director of data solutions at Optimal Blue, said in a statement. “Refinances made up a quarter of all lock activity for the first time in six months, and we saw a clear rise in non-conforming loan share as buyers looked for more flexible options and higher loan amounts. These are key indicators that consumers are actively adapting to the current rate environment.”
While purchase rate lock volume increased on a month-to-month basis, there was a 1.9 percent drop in volume on a year-to-year basis. Additionally, adjustable rate mortgages accounted for just below nine percent of total rate lock volume in March, a result tied to growing demand for non-conforming loan options according to Optimal Blue.
The average home purchase price rose from February’s $480,200 to $486,900 in March, driving a month-over-month increase in average loan amount from $380,500 to $391,700. The average loan amount in Greater Boston in March was $611,200.
Some of Greater Boston’s most prominent residential brokerage leaders predicted last week that the Trump administration’s trade war won’t harm homebuyer demand this spring, but since then American stock markets have suffered significant losses amid serious retaliatory moves by China and the European Union, with analysts at many major banks now predicting the country is likely headed for a recession.
