Mortgage bankers have again raised their expectations for new lending, with nearly $400 billion more expected for the years 2015 through 2018.
For the first three months of this year, U.S. home lending activity
is projected to reach $350 billion then climb to $405 billion in the second quarter.
New business, however, is then expected to back off during the following quarter, with residential loan production projected to reach $400 billion.
That is according to the Mortgage Bankers Association in its MBA Mortgage Finance Forecast.
The first-quarter projection rose from $320 billion in last month’s outlook, while the second-quarter amount grew from $372 billion and the third-quarter forecast
was lifted from $367 billion.
It was the second month in a row that the association improved its outlook
MBA increased its purchase financing forecast to $185 billion from $179 billion for the current quarter, while the second-quarter purchase outlook rose to $265 billion from $256 billion.
First-quarter refinance volume is now expected to come in at $165 billion versus the $141 billion previously expected, while the following quarter’s refinance outlook grew to $140 billion from $116 billion.
The trade group lifted its estimate of full-year 2015 total volume to $1.630 trillion from $1.486 trillion in the last report.
MBA predicts that total originations will amount to $1.483 trillion this year, up from $1.380 trillion in the last forecast.
The 2017 outlook increased to $1.383 trillion from $1.309 trillion, while the 2018 forecast grew to $1.347 trillion from $1.297 trillion.
MBA now has its estimate of purchase financing for last year at
$0.881 trillion versus the $0.821 trillion in the last report.
The 2016 purchase projection increased to $0.963 trillion from $0.926 trillion, while next year’s prediction expanded to $1.011 trillion from $0.978 trillion, and the 2018 purchase outlook was raised to $1.046 trillion from $1.022 trillion.
On just refinance production, the 2015 estimate increased to $0.749 trillion from $0.665 trillion in the January outlook.
This year’s refinances are now projected at $0.520
trillion compared to the earlier forecast of $0.454 trillion. The 2017 refinance outlook increased to $0.372 trillion from $0.331 trillion, and the following year is expected to see $0.301 trillion in originations versus the $0.275 trillion expected last month.
Refinance share is expected to go from 46 percent last year to 35 percent in 2016 then fall to 27 percent next year and 22 percent in 2018.
