The latest update to expected originations has this year coming in at the highest level in three years thanks to a stronger outlook for refinance volume. Next year’s forecast was increased by even more. Even the projection for purchase production was pushed up by a quarter for this year and last year — though next year’s purchase outlook was scaled back.
The latest forecast has fourth-quarter residential originations at $452 billion then falling to $431 billion in the first-quarter 2013.
Last month, just $319 billion in fourth-quarter production was expected, while $276 billion was projected for the following three-month period.
The data released Tuesday from the Mortgage Bankers Association indicated that purchase financing volume is now expected to go from $123 billion this quarter to $125 billion in the first three months of next year versus last month’s MBA forecast that purchase-money lending would increase from $112 billion to $135 billion.
Fourth-quarter refinance projections were raised from last month’s forecast of $207 to $329 billion, while the first-quarter 2013 forecast increased from $141 billion to $306 billion.
MBA has refinance share at 6 percent this quarter and the next quarter then spending the next seven quarters at 7 percent.
MBA revised its full-year 2011 estimate from $1.262 trillion predicted last month to $1.436 trillion in the latest outlook. This year’s projection was bumped from $1.466 trillion to $1.691 trillion, while next year’s forecast was pushed up from $1.043 trillion to $1.343 trillion.
The estimate of 2011 purchase financing improved to $0.505 trillion from $0.404 trillion, while this year’s forecast was raised to $0.503 trillion from $0.406 trillion. But next year’s prediction was dropped to $0.585 trillion from $0.631 trillion.
Last year’s refinance estimate was boosted to $0.931 trillion from $0.858 trillion, this year’s was lifted to $1.188 trillion from $1.060 trillion and next year’s was supercharged to $0.758 trillion from $0.412 trillion.
In 2014, the trade group projects overall originations of $1.053 trillion, including $0.690 trillion in purchase transactions and $0.363 trillion in refinances.