In the first quarter of 2023, private mortgage insurers experienced a decline in new insurance written activity compared to the same period last year. Despite this, it was relatively flat compared to the volumes seen in the last three months of 2023. The decrease in new insurance written activity was even more pronounced when compared to the fourth quarter of 2023, with a 15% decrease.
During this time, MGIC saw a decrease in market share, benefiting Radian and National MI instead. Radian saw a 1.5 percentage point increase to 19.5% market share, while National MI saw an 0.8 percentage point increase. Industry-wide, new insurance written for the first quarter totaled $59.1 billion, slightly higher than the previous quarter’s volume of $59 billion but lower than the $64.6 billion seen in the first quarter of the previous year.
Total mortgage production also decreased quarter-to-quarter, with estimates from the Mortgage Bankers Association showing $377 billion for the period ended March 31 compared to $399 billion three months earlier. Despite this decrease, it was still higher than the first quarter of 2023, which saw a volume of $333 billion.
Private mortgage insurance is often used as credit enhancement for loans with loan-to-value ratios over 80% sold to Fannie Mae and Freddie Mac. It competes with government programs like the Federal Housing Administration (FHA). As credit markets tighten and home prices continue to rise, private mortgage insurers are facing increasing pressure to provide more coverage at lower premiums to remain competitive in an increasingly crowded marketplace.
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