Estimations by mortgage bankers for last year’s and this year’s refinances improved, as did the outlook for 2016 purchase financing.
Total mortgage originations are expected to fall from $380 billion in the final quarter of last year to $320 billion during 2016’s first quarter.
Industry-wide production is
then projected to increase to $372 billion in the second quarter and slip to $367 billion three months later.
The predictions were made by the Mortgage Bankers Association in its
MBA Mortgage Finance Forecast.
The trade group lifted its fourth-quarter 2015 estimate from $360 billion
projected last month. As well, originations in this year’s first, second and third quarters were respectively raised from $293 billion, $360 billion and $355 billion.
MBA increased its first-quarter purchase financing forecast to $179 billion from $175 billion, while the second-quarter outlook was expanded to $256 billion from $250 billion.
The current quarter’s refinance outlook rose to $141 billion
from $118 billion, and the second-quarter projection grew to $116 billion from $110 billion.
Full-year 2015 total production is estimated at $1.486 trillion, more than the $1.466 trillion forecasted in December.
This year’s expected originations increased to $1.380 trillion from $1.320 trillion.
The improved outlook from MBA contrasts that of Fannie Mae, which last week lowered its outlook for 2015 and 2016 industry-wide mortgage production.
There was no change to the 2017 projection of $1.309 trillion or the 2018 forecast of $1.297 trillion.
The association has purchase financing volume climbing from $0.926 trillion this year to $0.978 trillion in 2017 and $1.022 trillion the following year. The 2016 purchase outlook increased from $0.905 trillion in the last forecast.
MBA raised expected refinance volume for 2015 to $0.665 trillion from $0.645 trillion, while this year’s refinance forecast grew to $0.454 trillion from $0.415 trillion a month earlier.
There was no change to MBA’s refinance projections of $0.331 trillion for 2017 and $0.275 trillion for 2018.
Refinance share is predicted to contract from 45 percent last year to a third this year and a quarter in 2017. Refinance share is expected to be just 21 percent in 2018.
