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Question #8 for 2022: Housing Credit: Will we see easier mortgage lending in 2022?


by Calculated Risk on 12/30/2021 03:12:00 PM

Today, in the Real Estate Newsletter: Question #8 for 2022: Housing Credit: Will we see easier mortgage lending in 2022?

A brief excerpt:

Earlier I posted some questions on my blog for next year: Ten Economic Questions for 2022. Some of these questions concern real estate (inventory, house prices, housing credit, housing starts, new home sales), and I’ll post those in the newsletter (others like GDP and employment will be on my blog).

I’m adding some thoughts, and maybe some predictions for each question.

For Q3 2021, the Net Equity Extraction was $147 billion, or 3.24% of Disposable Personal Income (DPI). The last two quarters have shown a sharp increase in equity extraction compared to recent years, but the level is nothing like the amount of equity extraction during the housing bubble as a percent of DPI. During the housing bubble we saw several quarters with MEW above 8% of DPI.

Mortgage equity withdrawal will probably decline in 2022, since fewer homeowners will refinance their mortgages. However, there is some concern about banks easing lending standards, and the rapid increase in non-QM loans.

This will be something to watch in 2022, but overall lending is still solid (unlike during the housing bubble).

There is much more in the article. You can subscribe at

Question #9 for 2022: What will happen with house prices in 2022?

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