The latest prediction of what mortgage originations will be has increased. The report indicates that loan officers can look for fewer refinance applications and more adjustable-rate activity.
Second-quarter residential originations are expected to increase to $444 billion from the first quarter’s $342 billion, Freddie Mac projected in its June 2010 Economic and Housing Market Outlook.
The forecast was a leap from the $401 billion second-quarter projection that Freddie made last month.
But volume is expected to fall back to $419 billion in the third quarter.
Government production is predicted to reach $115 billion, better than the first quarter’s $92 billion. This quarter’s conventional business is estimated to rise to $329 billion from $250 billion.
Home loan volume is forecasted to fall to $1.550 trillion for all of 2010 from an estimated $2.000 trillion last year. Last month’s outlook had this year’s fundings at $1.500 trillion.
Adjustable-rate mortgages are expected to account for 4 percent of second-quarter production, the same as the first quarter. ARM share is forecasted to reach 6 percent by the end of this year and 9 percent by the end of next year.
Refinance share of originations was forecasted to come in 70 percent, lower than the first quarter’s 75 percent but higher than 40 percent projected for the fourth quarter of this year.
