Fannie Mae economists have increased their estimates of home purchase financing for last year, this year and next year. Even last year’s estimated refinances grew.
The Washington-based secondary mortgage lender expects second-quarter 2017 residential originations by all U.S. lenders to come in at $454 billion.
Home lending is then expected to fall to $414 billion three months later and $362 billion during the final-three months of this year.
The projections were made in Fannie’s Housing Forecast: May 2017.
Fannie lifted its current-quarter forecast from $444 billion in the April outlook. The third-quarter outlook, though, was trimmed from $416 billion.
Purchase financing is expected to account for $311 billion of the second-quarter
total, up from $306 billion expected last month. The third-quarter outlook was trimmed to $305 billion form $308 billion.
Fannie raised its second-quarter refinance projection to $143 billion from $139 billion, while the following quarter’s refinances are still expected to total $109 billion.
Fannie expects overall full-year originations to fall from $2.051 trillion last year to $1.590 trillion in 2017 and $1.538 trillion in 2018. That outlook increased from $1.963 trillion previously estimated for 2016, $1.578 trillion for this year and $1.534 trillion for 2018.
The 2016 purchase-money estimate climbed to $1.061 trillion from $1.014 trillion estimated in April. This year’s purchase forecast increased to $1.081 trillion from $1.068 trillion, and the 2018 outlook expanded to $1.158 trillion from $1.153 trillion.
Last year’s refinance estimate increased to $0.991 trillion from $0.949 trillion in the previous forecast. Fannie left 2017’s projection at $0.510 trillion and 2018’s at $0.381 trillion.
Refinance share is expected to thin from 32 percent in 2017 to 25 percent in 2018.
