In addition to raising its estimate of first-quarter refinances, Fannie Mae boosted its forecast for refinance production during the following two quarters.
From April 1, 2017, through mid-year, overall U.S. originations — including purchase financing and refinancing — are expected to total $462 billion.
Home lending is then projected to recede to $423 billion in the third quarter and to $363 billion during the final-three months of this year.
Washington-based Fannie presented the predictions in its Housing Forecast: June 2017.
The second-quarter forecast improved from $454 billion in last month’s
outlook, while the following quarter’s projection rose from $414 billion.
Fannie trimmed its second-quarter prediction for purchase-money lending
to $304 billion from $311 billion, while next quarter’s expected purchase production was mostly unchanged at $307 billion.
The secondary lender revised its estimate of first-quarter refinances up to $172 billion from $158 billion a month earlier, and the current-quarter outlook improved to $159 billion from $143 billion. The following period’s projection was pushed up to $116 billion from $109 billion.
In the report, full-year 2016 overall production inched up to $2.052 trillion from $2.051 trillion predicted a month earlier. This year’s outlook was lifted to $1.624 trillion from $1.590 trillion, and next year’s forecast dipped to $1.533 trillion from $1.538 trillion.
Expected purchase financing for 2017 is now $1.078 trillion versus $1.081 trillion in the last report, while next year’s activity is expected to total $1.153 trillion compared to $1.158 trillion expected last month.
Fannie increased this year’s projected refinances up to $0.546 trillion from $0.510 trillion in the preceding forecast, and the 2018 outlook was left at $0.381 trillion.
Thirty-four percent of 2017 originations are expected to be refinances. Next year, refinance share is anticipated to be a quarter.
