Although the annual volume of loans to finance a home purchase are forecasted to grow, a drop in projected refinances will drag down overall activity.
During the three months ended Sept. 30, single-family loan originations, including refinances and purchase financing, are expected to come to $500 billion.
National mortgage production from all U.S. home lenders is then projected to fall to $413 billion during the final-three months of this year.
That is according to the September 2017 Economic & Housing Market Forecast from Freddie Mac. The secondary mortgage lender made no changes from its outlook issued last month.
Based on reported refinance share, estimated refinance originations are expected to fall from $160 billion in the current quarter to $132 billion in the fourth quarter.
The origination of loans to finance a home purchase are expected to drop from $340 billion in the third quarter to $281 billion three months later.
Freddie predicts that full-year overall originations will go from $1.800 trillion this year to $1.695 trillion in 2018.
This year’s refinances are expected to amount to $0.594 trillion in 2017 then recede to $0.424 trillion a year later.
Refinance share is forecasted to thin from a third during the current 12-month period to a quarter in 2018.
Purchase-money production will grow from $1.206 trillion in 2017 to $1.271 trillion next year.
Based on Freddie’s projected origination of mortgages either insured by the Federal Housing Administration or guaranteed by the Department of Veterans Affairs, government share will thin from 23.6 percent this year to 21.7 percent next year.
