The nation’s mortgage bankers have grown more optimistic about the volume of refinance originations expected during the final three months of this year.
Total home lending activity by all U.S. lenders is
forecasted to reach $363 billion during the third quarter of this year.
Production, including refinancing and purchase financing, is then expected to drop to $303 billion in the fourth quarter and $273 billion in the first-quarter 2016.
The Mortgage Bankers Association, which made the predictions in its
MBA Mortgage Finance Forecast, raised the fourth-quarter
outlook from August, when it expected $283 billion in fourth-quarter 2015 volume.
MBA has purchase financing falling from $236 billion in the current quarter to $185 billion in the fourth quarter, the same as in the last outlook.
Refinances are predicted to decline from $127 billion to $118 billion. The fourth-quarter outlook was boosted from just $98 billion in refinancing activity expected in the last forecast.
MBA has full-year originations retreating from $1.391 trillion this year to $1.264 trillion in 2016. The 2015 projection increased from $1.371 trillion in the last report.
Purchase volume is expected to rise from $0.801 trillion in 2015 to $0.885 trillion next year, no different that last predicted by the trade group.
Refinance originations are forecast to fall from $0.590 trillion during the current year to $0.379 trillion next year. MBA raised the 2015 refinance outlook from $0.570 trillion expected as of last month.
Refinance share is projected to fall from 42 percent this year to 30 percent in 2016.
