Mortgage lenders issued $1.61 trillion in purchase loans in 2021, up from $1.48 trillion in loans issued in 2020 and marking the highest mortgage borrowing numbers ever recorded.
The 2021 figures exceeded a previous record set in 2005, when $1.51 trillion in loans were issued, according to The Wall Street Journal.
The record-setting numbers reflect a red-hot housing market. At the beginning of the pandemic, people were drawn to the market with low interest rates and desire to have more space at home — desires that continue to drive up house prices, the Journal noted.
Home prices went up by 18.4 percent in October, marking a slight drop from when home prices were up by 19.1 percent in September.
But with a strong labor market, Americans who have obtained pay raises or saved during the pandemic are potentially prepared to step into the housing market despite the soaring costs.
The Bureau of Labor Statistics reported that wages for all private-sector workers increased by 4.6 percent year over year in the third quarter, the Journal noted.
“All of that extra income goes somewhere, and a lot of it went into housing,” Taylor Marr, deputy chief economist at Redfin Corp., a real-estate brokerage, told the newspaper.