A new forecast for mortgage production has refinancing activity much lower for last year and this year than other industry estimates.
Home loan originations by all U.S. mortgage lenders worked out to an estimated $1.065 trillion during all of last year.
The total included estimated refinances ranging between 1.3 million loans for $0.278 trillion and 1.6 million loans for $0.349 trillion.
The purchase financing portion of 2014 activity was 3.1 million loans for $0.716 trillion.
iEmergent, was responsible for the estimates.
The refinance estimate from the market research and advisory firm was substantially lower than estimates ranging from $0.484 trillion to $0.516 trillion from Fannie Mae, Freddie Mac and the Mortgage Bankers Association.
But iEmergent’s outlook for purchase production was higher than industry estimates of between $0.638 trillion to $0.684 trillion.
This year, iEmergent projects that total originations will be $1.167 trillion.
The 2015 refinance forecast ranges between 1.4 million and 1.8 million loans for between $0.306 trillion and $0.384 trillion. It also includes 3.3 million loans for $0.783 trillion in purchase financing.
iEmergent Founder Dennis Hedlund noted in the announcement that 2015 might be a turbulent year.
“On one hand, home prices are slowly rising, interest rates still remain low and job growth seems to be steady — all of which bode well for housing,” Hedlund stated in the report. “Yet, if even one of those factors is removed from the equation, or credit availability remains tight despite new initiatives to help first-time home buyers or those with limited savings, housing could easily sputter backwards and recovery would stall for a period once again.”
While iEmergent’s expectation for 2015 purchase production is in line with industry estimates, the refinance forecast was well below the $0.491 trillion to $0.574 trillion
projected in the competing forecasts.
In 2016, iEmergent has total production amounting to $1.247 trillion. Refinances are expected to account for $0.409 trillion, while purchases will make up $0.838 trillion.