After months of improved expectations, economists at Fannie Mae have pulled back slightly on their outlook for home lending volume.
Residential loan originators are expected to generate $300 billion in total mortgage production during the first three months of this year.
New business is then expected to accelerate to $377 billion in the second quarter and $372 billion during the following three months.
Fannie Mae made the predictions in its Housing Forecast: January 2016.
But despite the progressive outlook, the quarterly totals were lower than in the secondary lender’s previous forecast. It was the first month Washington-based Fannie has not raised
its outlook since August 2015.
The first-quarter total was trimmed $10 billion from the December report, while second-quarter expected volume was slightly off $379 billion previously predicted and the third-quarter projection was pruned $2 billion.
Fannie has first-quarter purchase financing at $170 billion, off $3 billion from the prior forecast. Purchase production is expected to soar to $264 billion the following quarter, though it was previously projected at $266 billion.
The first-quarter refinance outlook was lowered to $129 billion from $137 billion in last month’s outlook. The second-quarter refinance forecast was left at $113 billion.
Full-year overall 2015 originations are estimated at $1.673 trillion, less than the $1.711 trillion that had been expected in last month’s outlook.
Fannie reduced this year’s outlook to $1.396 trillion from $1.410 trillion previously forecasted. But the 2017 projection was lifted to $1.397 trillion from $1.390 trillion.
The report has purchase production rising from $0.895 trillion last year to $0.946 trillion in 2016 and $1.003 trillion next year.
Refinance originations are expected to fall from $0.778 trillion in 2015 to $0.450 trillion this year and further retreat to $0.393 trillion in 2017.
Refinance share is estimated at 46 percent last year and expected to tumble to 32 percent in 2016 and 28 percent next year.
