The latest first-quarter mortgage origination forecast was cut by $37 billion.
First-quarter residential originations are projected at $332 billion, Fannie Mae reported in its Housing Forecast: March 2010. That’s a significant decline from $543 billion in U.S. volume during the fourth-quarter 2009 and lower than the $369 billion forecasted last month by the secondary lender.
This year’s fundings are projected to peak in the second quarter at $354 billion then fall to $298 billion by the final quarter.
Full-year production is expected to tumble to $1.314 trillion from $1.968 trillion last year. This month’s estimate for 2010 volume was down $24 billion from the prior month’s projection.
Next year, Fannie forecasts originations will come in at $1.587 trillion.
First-quarter refinance share is expected to reach nearly two-thirds, the same as the fourth-quarter 2009. But Fannie sees refinances accounting for just 36 percent of fundings by the fourth quarter.
Refinance share is projected to fall to 44 percent this year from just over two-thirds last year.
U.S. mortgages outstanding finished last year at $10.764 trillion, falling from $11.005 trillion a year earlier. Outstandings are expected to fall further — to $10.680 trillion this quarter and to $10.481 trillion by the fourth quarter.
First liens accounted for $9.643 trillion of estimated first-quarter outstandings.
The government-controlled enterprise predicted that the 30-year fixed-rate mortgage will average 5.02 percent this quarter, up from 4.92 percent in the fourth quarter. By the end of this year, the 30-year is expected to climb to 5.43 percent.
