|A surge in conventional activity pushed quarterly U.S. originations higher, but an increase in government business is expected to lead an annual increase. Third-quarter residential originations are expected to double from the first quarter.Residential originations by U.S. lenders were an estimated $420 billion during the first quarter, Freddie Mac reported in its Economic and Housing Market Outlook today. Production picked up from $294 billion in the prior quarter but was lower than $486 billion a year earlier.
First-quarter conventional originations of $330 million were 57 percent higher than in the fourth quarter, while FHA and VA volume was up just 7 percent.
Freddie projects total U.S. originations to soar to $730 billion this quarter and peak at $890 billion in the third quarter.
During all of 2009, originations are forecasted to hit $2.7 trillion, surging from last year’s $1.7 trillion. The forecast is just slightly higher than last month’s prediction. Conventional activity is projected to rise to $2.2 trillion this year from $1.4 trillion, while government activity will increase to $0.5 trillion from $0.3 trillion in 2008.
Next’s year’s production is projected at $2.175 trillion.
The 30-year fixed-rate mortgage, which averaged 4.86 percent last week in Freddie’s rate survey, is expected to average 4.8 percent in the second quarter, edge up to 5.1 percent by yearend and climb to 5.9 percent by the end of 2010.
back to current headlines