Expected loan originations for the three years ended 2018 have been increased by $300 billion, with both purchases and refinances benefiting.
Total U.S. mortgage production, including refinancing and purchase financing, is forecasted to reach $561 billion during the the third quarter.
Home-lending activity is then projected to tumble to $395 billion in the final quarter and $346 billion during the first-three months of next year.
Those predictions were made by the Mortgage Bankers Association in its MBA Mortgage Finance Forecast.
The trade group lifted its current-quarter outlook from $518 in last month’s forecast, while the fourth-quarter projection was up from $363 billion and first-quarter 2017 expectations increased from $295 billion.
Purchase-money originations are expected to fall from $298 billion in the third-quarter 2016 to $223 billion three months later, the same as in last month’s outlook.
But the current quarter’s refinance outlook increased to $263 billion from $220 billion, while the fourth-quarter refinance forecast was lifted to $172 billion from $140 billion.
Full-year 2016 overall volume is predicted to be $1.816 trillion. Originations are then expected to fall to $1.509 trillion the following year and $1.446 trillion in 2018.
This year’s projection increased from $1.741 trillion expected last month, while the 2017 outlook grew from $1.383 trillion, and the next year’s forecast expanded from $1.347 trillion.
MBA expects purchase financing to total $0.981 trillion in 2016, $1.085 trillion a year later and $1.145 trillion in 2018. The 2017 projection was raised from $1.011 trillion, while the association increased the following year’s purchase-money outlook from $1.046 trillion.
Expected refinance production was increased to $0.835 trillion for this year from $0.760 trillion in the July outlook. The 2017 refinance outlook grew to $0.424 trillion from $0.372 trillion, and there was no change to the 2018 refinance outlook of $0.301 trillion.
MBA has refinance share at 46 percent for 2016, 28 percent the following year and 21 percent for 2018.
