The annual volume of mortgage originations to finance residential property purchases is forecasted to surpass $1 trillion within three years.
For all of this year, home lending activity, including purchase financing and mortgage refinances, is expected to amount to $1.466 trillion.
Total loan production from all mortgage banking firms is then expected to move lower during 2016, to just $1.320 trillion.
That is according to the Mortgage Bankers Association’s
MBA Mortgage Finance Forecast.
The trade group made no revisions from its prior-month mortgage forecast.
In 2017, MBA has total originations slipping to $1.309 trillion, then taking another dip in 2018 to $1.297 trillion.
The decline was more severe for the refinance outlook, with total refinancing activity slowing from $0.645 trillion in 2015 to $0.415 trillion next year. Refinance lending is again expected to drop in 2017, to $0.331
trillion, and in 2018, to $0.275 trillion.
But the story is different from the association’s prediction for purchase financing activity.
This year, $0.821 trillion in loans to purchase a home are expected to be closed.
MBA then has total purchase originations climbing to $0.905 trillion in 2016.
The following year, a further increase, to $0.978 trillion in purchase financing, is expected to occur, while it is projected to climb past a trillion dollars — to $1.022 trillion — in 2018.
Refinance share is forecasted to thin from 44 percent to 31 percent in 2016, a quarter the following year and 21 percent in 2018.