Where Homeowners Are Taking Advantage of Lower Mortgage Rates

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Unemployment rates vary widely among U.S. states link

• Unemployment rates across the 50 states varied by 380 basis points in December 2024. South Dakota had the lowest rate at 1.9%, while Nevada and California had the highest at 5.7% and 5.5%, respectively.

• South Carolina saw the biggest jump in unemployment from December 2023 to December 2024 at 170 bps. Connecticut had the largest decline, dropping 120 bps over the same period.

• The national unemployment rate increased 30 bps year-over-year to 4.1% in December 2024. Massachusetts, Oregon, Texas, and West Virginia were within 10 bps of the national average.

Small Multifamily Valuations Start to Rise Again and Originations Are Up link

• Small multifamily valuations rose 0.7% quarter-over-quarter in Q4 2024 but were still down 2.1% year-over-year. This marked the seventh straight quarter of price declines, though the rate of decline has slowed.

• Origination volumes reached $46.7 billion in 2024, close to the pre-pandemic average of $50.5 billion from 2015–2019. Higher interest rates have reduced cash-out loans from 75.6% of the total in Q3 2022 to 68.4% in Q4 2024.

• Cap rates for small multifamily properties averaged 6%, 40 basis points higher than the overall multifamily average of 5.6%. Occupancy rates climbed 11 basis points year-over-year to 97.5%, showing stable demand despite high construction levels.

Industrial demand increases amid manufacturing boom link

• Manufacturing construction spending has tripled since 2021, with 346.2 million square feet under construction as of January 2025. Over 100 million square feet of new space has already been delivered since 2022.

• Dallas-Fort Worth led the nation with $6 billion in industrial sales in 2024, followed by Houston and Phoenix at $3.4 billion each. Los Angeles was the top port market, closing $3.2 billion in sales.

• Vacancy rates have risen but are expected to stabilize in 2025, even as demand remains strong. Bridgeport saw the highest premium for new leases at $5.22 more per square foot, followed by Miami, New Jersey, and Boston.

Top 10 U.S. Metros with Quarterly Refinance Mortgage Originations on the Rise link

• Refinance mortgage originations rose 6.4% in Q4 2024 to 642,000 loans, the highest level since mid-2022. This marks the third straight quarterly increase, up 28.2% from Q4 2023.

• Hilton Head Island-Bluffton-Beaufort, SC saw the largest jump, with refinance originations increasing 56.4% from 369 in Q3 to 577 in Q4. Wilmington, NC and San Jose, CA followed with increases of 48.9% and 43.8% respectively.

• Despite the rise in refinances, total mortgage originations fell 3% from Q3 2024 due to a 7.5% drop in home purchases and an 11.6% drop in home equity credit lines. Lending activity remained nearly two-thirds below the 2021 peak.

• click on the link to see the rest of the list.

The 5 Cities Where Homeowners Are Taking Advantage of Lower Mortgage Rates link

• Refinancing activity increased despite rising rates, with 641,918 refinance mortgages issued in Q4 2024—up from 603,324 in Q3. Total mortgage originations reached 1.64 million in Q4 alone.

• Hilton Head, SC saw the biggest jump in refinancing at 56.4%, followed by Wilmington, NC (48.9%) and San Jose, CA (43.8%). Buffalo, NY (41.9%) and San Francisco, CA (35.4%) also saw significant increases.

• The current mortgage rate of 6.76% is the lowest since December 2024. Most homeowners with rates below 6% are unlikely to benefit from refinancing unless they bought when rates were over 7%.

Multifamily Permitting Continues to Shrink link

• Six of the top 10 metro areas saw multifamily permitting drop by double digits. Phoenix, Austin, and Los Angeles had the biggest declines, ranging from 33% to 42%.

• New York-White Plains led the nation with a 60% increase in permitting, reaching 36,630 units. Atlanta also saw a jump, while Dallas and Austin permitted over 14,000 units each.

• Jacksonville (-5,300), Minneapolis/St. Paul (-5,177), and Riverside (-4,269) had the steepest declines outside the top 10. Permitting in the top 150 markets has stayed below 400,000 units for six months after peaking at 577,000 units in late 2022.

• VIE, a predictive maintenance co, raised a $15M A round led by Energy Impact.

• Turing, an AI water mgmt software, raised a $14M round led by Safar Partners.

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