The collective forecast for home lending volume last year, this year and next year has been bolstered by more than a half-trillion dollars, and purchase production saw the biggest improvement.
Third-quarter mortgage originations are estimated to have come in at $419 billion. Volume is expected to dip to $394 billion this quarter then fall to $298 billion in the first-three months of next year.
That’s quite an improvement over last month’s outlook, when production was expected to go from $371 trillion in the third quarter to $323 billion
then settle at $250 billion in the first-quarter 2016.
The outlook was delivered by Fannie Mae in its Housing Forecast: October 2015.
Fannie raised its
third-quarter estimate of purchase financing to $256 billion from $229 billion in the last forecast, while fourth-quarter purchase volume is now expected to reach $246 billion versus $212 billion.
Refinance activity is projected to fall from $164 billion to
$148 billion in the current quarter compared to September’s projection that refinance originations would decline from $142 billion to $112 billion in the final quarter of this year.
The secondary lender lifted its overall estimate of 2014 originations to $1.301 trillion from $1.184 trillion in last month’s outlook.
Rival Freddie Mac previously explained that an increase in its own estimate of last year’s originations was the result of higher mortgage production than previously estimated per recently released Home Mortgage Disclosure Act data for 2014.
Fannie raised the 2015 origination forecast to $1.697 trillion from $1.477 trillion, while next year’s outlook increased to $1.408 trillion from $1.219 trillion.
Last year’s purchase production is now estimated at $0.783 trillion, more than the prior estimate of $0.676 trillion. This year’s expected purchase financing rose to $0.917 trillion from $0.798 trillion, and the 2016 forecast climbed to $0.956 trillion from $0.845 trillion.
Refinance business, meanwhile, is now estimated at $0.518 trillion for 2014 compared to $0.508 trillion previously estimated. The 2015 refinance outlook increased to $0.779 trillion from $0.679 trillion, while next year’s refinances are predicted to reach $0.452 trillion compared to $0.373 trillion previously expected.
Fannie has refinance share rising from 40 percent in 2014 to 46
in the current year then retreating to 32 percent in 2016.
