Fewer lenders see home prices rising, while more said it was hard to get a home loan, according to a survey of senior mortgage executives. The outlook is for weakening mortgage demand.
Less than half of the respondents predicted that home prices will increase over the next 12 months, declining from 58 percent in the second quarter.
Conversely, just 2 percent predicted a decline in home prices, off from 4 percent. Nearly half forecasted no change ahead.
The findings were detailed in Fannie Mae’s third-quarter Mortgage Lender Sentiment Survey conducted on senior executives — including chief executives and chief financial officers — at its approved sellers and servicers.
It would be difficult to get a mortgage today according to 85 percent of the executives. The share rose from 81 percent three months earlier.
Meanwhile, just 15 percent considered it an easy time to get a mortgage, down from 19 percent.
At the same time, the share of executives who saw an increase in demand for GSE-eligible loans over the past three months fell to 53 percent from 56 percent, while decreased demand was noted by 17 percent versus 19 percent in the prior survey.
Demand for non-GSE loans went up at nearly two-thirds of lenders compared to 60 percent in the second quarter. A drop in non-GSE demand was noted by 8 percent of those surveyed, down from 14 percent.
On government loans, the share who noted a rise in demand was unchanged at 43 percent, and the share who indicated a decline fell to 23 percent from 28 percent.
For all three types of loans, the share who see demand strengthening over the next three months tumbled, and the share who expect a decline jumped.
One good bit piece of information was that the share of executives among all lenders sizes who said credit standards eased moved up — especially for non-GSE eligible loans — and the share who said they tightened moved lower.
But among larger originators, the share who said GSE credit standards tightened was larger.
