Mortgage bankers have scaled back their projections for purchase financing this year and next year but lifted their refinance forecast.
During the final three months of this year, $293 billion in residential originations — including refinances and purchase financing — are predicted. Volume is expected to drop to $264 billion then increase to $311 billion in the second-quarter 2014.
Last month, fourth quarter-volume was predicted to be $283 billion then fall to $273 billion during the first quarter of next year and rise to $308 billion in the following period.
The outlook was outlined in the MBA Mortgage Finance Forecast from the Mortgage Bankers Association.
The fourth-quarter refinance projection was raised to $155 billion from $136 billion, and the first-quarter 2014 refinance outlook inched up to $132 billion from $131 billion.
But this quarter’s purchase financing forecast was cut to $138 billion from $147 billion, while expected purchase production for the first quarter of next year fell to $132 billion from $142 billion.
MBA increased its overall 2013 forecast to $1.755 trillion from $1.745 trillion predicted in October. But next year’s projection was lowered to $1.180 trillion from $1.186 trillion.
Full-year 2015 originations are still expected to come in at $1.229 trillion.
This year’s refinance forecast rose to $1.103 trillion from $1.083 trillion, and next year’s crept up to $0.465 trillion from $0.463 trillion. The 2015 refinance forecast was left at $0.433 trillion.
Refinance share is expected to fall from 63 percent in 2013 to 39 percent next year and 35 percent in 2015.
This year’s purchase projection fell to $0.652 trillion from $0.661 trillion, while the 2014 forecast was reduced to $0.715 trillion from $0.723 trillion. The following year, mortgage lenders are expected to generate $0.796 trillion in purchase production.
