Mortgage bankers have reduced their forecast for this year’s refinance originations by more than $20 billion, while next year’s refinance outlook was cut by a similar amount.
Total mortgage production by all U.S. lenders, including purchase and refinance activity, is projected to go from $226 billion in the first quarter to $272 billion in the second quarter and $298 billion in the following three-month period.
The second-quarter forecast inched up from $271 billion projected last month, while the third quarter outlook dropped from $315 billion.
The latest Mortgage Finance Forecast was released Monday by the Mortgage Bankers Association, which is hosting mortgage fraud and mortgage technology conferences in Los Angeles from Tuesday through Friday .
MBA said that refinance production is expected to slip from $111 billion in the current quarter to $109 billion in the second quarter then settle at $103 billion in the following period.
In its previous forecast, the trade group had refinance volume rising from $111 billion in the second quarter to $113 billion three months later.
Purchase financing is projected to jump from $115 billion in the first quarter to $163 billion the following period and $195 billion in the third quarter.
MBA increased its second-quarter purchase forecast from $160 billion but cut its third-quarter outlook from $202 billion.
For all of this year, MBA expects $1.080 trillion in total originations, less than the $1.102 trillion expected last month. The 2015 full-year forecast was reduced to $1.219 trillion from $1.229 trillion.
The 2014 refinance forecast fell to $0.419 trillion from $0.440 trillion, while next year’s projected refinances fell to $0.411 trillion from $0.433 trillion.
MBA has refinance share going from 39 percent this year to 34 percent in 2015.
The 2014 purchase financing outlook slipped to $0.661 trillion in the latest outlook from $0.663 trillion expected last month. Next year’s prediction for purchase production, however, was lifted to $0.808 trillion from $0.796 trillion.
