Expected home lending activity this year has been raised $100 billion by Freddie Mac, and refinances were the biggest beneficiary.
During the three months
ended Sept. 30, Freddie predicts that mortgage originations by all U.S. lenders will total $380 billion.
Activity is expected to tumble to $285 billion in the fourth quarter and $260 billion during the first-three months of next year.
The latest forecast from the secondary lender was raised from last month, when Freddie predicted that volume would be $330 billion in the third quarter, $270 billion three months later and $250 billion in the first-quarter 2016.
Projected third-quarter refinances, based on refinance share, were increased to $152 billion from $116 billion, while fourth-quarter refinances are now expected to be $100 billion versus the $92 billion forecasted last month.
Freddie lifted its third-quarter purchase projection to $228 billion from $215 billion in the last report, and the fourth-quarter purchase outlook increased to $185 billion from $178 billion.
The total forecast for all of 2015 increased to $1.450 trillion from $1.350 trillion, while next year’s overall originations are now expected to come in at $1.300 trillion compared to $1.275 trillion previously forecasted.
This year’s refinance projection grew to $0.667 trillion from $0.581 trillion in the June outlook, and the 2016 refinance forecast was expanded to $0.390 trillion from $0.383 trillion.
Freddie expects refinance share to be 46 percent in 2015 and
30 percent next year.
Freddie predicts that purchase financing will amount to $0.783 trillion for all of this year, more than the $0.770 trillion previously expected. Next year’s purchase projection was increased to $0.910 trillion from $0.893 trillion.
Freddie has adjustable-rate mortgage share at seven percent for 2015 and
15 percent for 2016.
