Refinancing, Sales Fuel Title Insurers

Low interest rates, rising home prices and record house sales spurred a near doubling in the value of deals insured by Orange County title companies in the past year.

Local title insurers handled $47.6 billion in transactions for the 12 months ended March 31, an 82% increase from the year-ago period.

That's according to this week's Business Journal list, which ranks the 20 largest title insurers operating here based on data from Anaheim-based First American Real Estate Solutions, a unit of Santa Ana-based First American Corp.

The outlook for title insurers for the rest of the year is an open question. The Federal Reserve could keep interest rates stable with a still sluggish economy. But some industry watchers doubt whether rising home sales and prices can keep going at the same pace.

Sixteen of the companies on the list saw growth of more than 50% in their OC transactions insured, while 12 companies more than doubled their business.

Only one company, No. 14 Santa Ana-based Old Republic Title Co., posted a decline, dropping 3% in OC transactions. Twelve companies reported an increase in their share of the OC title market, while the other eight reported declines in market shares.

Despite big gains, the top two companies,No. 1 Fidelity National Title and No. 2 First American Title Insurance Co.,both shed market share. Fidelity's stake shrunk to 24.3% from 26% a year earlier. First American went from 23% a year earlier to 18%.

But neither insurer may mind all that much: Fidelty's insured transactions soared 78% to $11.8 billion, while First American's grew 48% to $8.7 billion.

Rising home sales and a surge in refinancing could just mean there's more than enough work to go around.

The industry's growth "is reflective of active refinancing market," said Jeff Fox, executive vice president at Southland Title of Orange County, which was ranked No. 4 in this year's list and saw its market share go from 3.6% a year earlier to 5.2%

During the period, Fidelity did 50,191 transactions, up 90% from 26,448 in the prior period. Average value of homes it insured dropped 3% to $243,130.

The average value of homes insured by First American dropped by about 4% to $281,805.

Orange-based American Title Co. came in at No. 3 with a 140% growth in OC transaction value. The company insured mortgages of $3.28 billion. Because of higher than average growth, American Title jumped two notches in this year's ranking. The average value of homes insured by American Title rose 23% to $185,280.

Irvine-based Southland Title had the biggest jump in ranking. The company jumped six spots from No. 10 last year. The move came on the back of 173% growth to $2.5 billion in OC transactions. Its average value of homes insured went up 17% to $196,732.

"The growth in our market share was planned," Southland's Fox said.

In all, eight companies rose in ranking, while nine declined. Three companies maintained their spots from last year.

The title company with the fastest percentage growth: Phoenix-based New Century Title Co., which posted 282% growth to $567 million in OC transactions.