The mortgage market has just had a record year. The mortgage IPO boom, however, is faltering.
Last year was a banner season for the IPO market in general and public offerings for mortgage companies in particular. Between July and December, eight of the 30 largest U.S. mortgage lenders announced his intention to go public.
It didn’t work out the way all companies hoped it would. Two lenders that went public this year, Home Point Capital Inc. and LoanDepot Inc., have significantly reduced their offers. Another lender, AmeriHome Mortgage, has abandoned its IPO plans and instead said it will sell to a bank. Shares of Caliber Home Loans Inc., which were due to be listed in October, have yet to go public.
“The average investor is not convinced that a mortgage company is a good bet as long as it owns stocks,” said Guy Cecala, managing director of Inside Mortgage Finance, an industry research firm. “It’s a cyclical business, and they don’t know what’s going to happen.”
With house prices soaring, many families are excluded from buying a home – and some buyers who have rushed regret having done it. Some of the borrowers who were allowed to put their mortgage payments on hold during the pandemic will struggle to get back on track when their relief programs end. And slightly higher mortgage rates weighed on refinancing and purchasing activity these last weeks.