Mortgage Daily

Published On: October 15, 2018

Even though national home lending by all originators is expected to retreat this year, an increase in purchase financing is expected to push up next year’s overall production.

American mortgage bankers are expected to originate 4.2 million loans for $1.1212 trillion this year that will be used to finance the purchase of a single-family residence.

That’s an increase over 2017, when purchase-money production amounted to a downwardly revised 4.1 million mortgages for $1.0734 trillion.

Next year, purchase production is expected to continue expanding — to 4.4 million loans for $1.2032 trillion.

iEmergent made the predictions Monday
in its 2019 Mortgage Forecast Update.

Using a simple average of iEmergent’s high and low refinance forecast,
2018 refinance production is forecasted to come in at around 1.8 million loans for $0.4292 trillion, tumbling from 2.5 million loans funding last year for $0.5975 trillion.

The 2019 refinance projection is 1.75 million loans for $0.4068 trillion.

Expected declines in refinances come as both short- and long-term interest rates are
on the rise.

The sum of purchase and refinance originations has an estimated total of
6.05 million home loans being originated this year for $1.5504 trillion.

Expected U.S. production is lower than 6.6 million loans for $1.6714 trillion closed during 2017.

But iEmergent’s outlook has an increase predicted for 2019, with an estimated 6.15 million mortgages expected to be originated for $1.6100 trillion.

“A year ago, we were skeptical that the tax bill would pass, but in a close-run battle, it did,” the report stated. “The consequences from that have been as expected, and on balance, they are bad for housing and for the mortgage industry. Most of the fiscal stimulus goes to older, wealthier households, not the younger households that drive most of housing demand.”

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