While quarterly and annual mortgage refinance production is expected to tumble, the volume of loans to finance home purchases is predicted to climb.
Originators of residential loans are expected to generate $335 billion in total mortgage originations during the first three months of this year.
Home lending is then expected to leap to $443 billion in the second quarter before retreating to $432 billion in the following three-month period.
Those predictions were made by Freddie Mac in its March 2017 Economic & Housing Market Forecast. There was no change from the February forecast.
Based on an analysis of Freddie’s total origination outlook and predictions for refinance share, refinances will make up $131 billion of the first-quarter projection and $120 billion of the the following quarter’s activity.
Purchase financing accounts for $204 billion of expected current-quarter volume and $323 billion of the second-quarter outlook.
Freddie has full-year 2017 overall originations coming in at $1.545 trillion, while next year’s expected total is
$1.500 trillion.
Refinances are predicted to make up $0.417 trillion of this year’s business and $0.300 trillion of the 2018 total. Refinance share is expected to fall from 27 percent during the current 12-month period to just a fifth next year.
The other $1.128 billion for 2017 is purchase financing. A year later, Freddie has purchase-money production at $1.200 trillion.
Based on projected government production, government share is likely to thin from 24.2 percent this year to 21.7 percent during 2018.
