The outlook for refinance originations was lowered, prompting a reduction to the overall annual forecast for mortgage business this year and next year.
First-quarter mortgage production by U.S. residential lenders is projected to total $482 billion. That prediction was lowered from $489 billion last month.
The projection for second-quarter home-loan business was cut to $379 billion from the $394 billion in originations forecasted in January.
Refinances are expected to fall from $357 billion to $220 billion in the second quarter, according to the MBA Mortgage Finance Forecast from the Mortgage Bankers Association. Last month, refinances were expected to decline from $362 billion to $229 billion.
Refinance share is projected to fall from 74 percent in the first quarter to 58 percent.
Economists at the trade group have purchase financing at $125 billion in the first quarter, then climbing to $159 billion in the following three-month period.
MBA has full-year mortgage production retreating from $1.396 trillion in 2013 to $1.055 trillion in 2014. Last month’s report had volume falling from $1.410 trillion to $1.061 trillion.
Refinance production is projected to tumble from $0.808 trillion in 2013 to $0.346 trillion next year, less than the $0.818 trillion and $0.358 trillion predicted last month for the respective years.
Purchase business is expected to jump from $0.588 trillion to $0.709 trillion in 2014. This year’s expectations were reduced from $0.592 trillion predicted last month, but the 2014 outlook inched up to $0.709 trillion from $0.703 trillion.
