Mortgage bankers have nudged up their expectations for purchase financing during 2018 and 2019. But next year’s outlook for refinance production diminished.
During the final-three months of this year, $415 billion in single-family loan originations — including loans to finance home purchases and refinances — are predicted.
U.S. mortgage production is then expected to drop to $344 billion in the first-quarter 2018 and bounce up to $450 billion three months later.
The predictions were made by the Mortgage Bankers Association in its
MBA Mortgage Finance Forecast.
The trade group lowered its first-quarter 2018 forecast from $355 billion projected last month but raised the second quarter outlook from $445 billion.
Purchase-money originations are expected to account for $262 billion of the current quarter’s activity and $225 billion of the following period’s business, down from a previously projected $237 billion.
Refinances are expected to go from $153 billion to $119 billion in the first-quarter 2018, up from $125 billion in the last forecast.
MBA has full-year overall originations slipping from $1.710 trillion in 2017 to $1.614 next year. But business is expected to climb to $1.645 trillion in 2019 and $1.712 trillion a year later. The 2018 outlook rose from $1.597 trillion previously expected, and the 2019 forecast was boosted from $1.640 trillion.
Purchase financing is projected to climb from $1.110 trillion in the current 12-month period to $1.190 trillion next year, $1.250 trillion in 2019 and $1.317 trillion in 2020. The 2018 forecast was raised from $1.184, while the following year’s projection inched up from $1.245 trillion.
The forecast has refinances totaling $0.600 trillion in 2017, $0.424 billion in 2018, $0.395 trillion in 2019 and $0.395 in 2020. Next year’s outlook fell from $0.430 trillion previously expected.
Refinance share is projected at 35 percent this year. The share will then thin to 26 percent next year, 24 percent in 2019 and 23 percent the following year.
Mortgages outstanding will grow from $10.010 trillion at the end of this year to $10.370 trillion a year later, $10.760 trillion in 2019 and $11.130 trillion at the end of 2020.
