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FTHB & Millennials
Introduction to iEmergent's First Time Homebuyer / Millennial Model: Part 2 of 2
iEmergent's updated 2017-2018 forecast is complete. Learn what's forthcoming for the U.S. mortgage market.
Halfway through 2017, our slow but lengthy recovery chugs on, while Congress struggles to make headway on the Trump administration’s fiscal policy initiatives. Healthcare reform efforts have stalled; tax reform efforts have only recently begun to show signs of progress; and infrastructure investment plans seem nearly forgotten. However, the economic situation is generally good.
For the mortgage market, the 2017 outlook looks a bit better than expected. Lack of progress on fiscal stimulus, as well as slow GDP growth, have meant less upward pressure on bond yields, which have trended down since January. While the refinance market will still decline sharply from 2016, moderating mortgage interest rates will soften that decline, so we’ve raised our refinance outlook slightly.
Our 2017-18 purchase market outlook also appears brighter. The steady economy, healthy labor market, still low mortgage rates, and stronger household balance sheets all improve the potential for more home purchase originations. Our 2017 purchase forecast is now $1.09 trillion, revised upward from our previous forecast of $1.03 trillion. We project that the increase in purchase originations will continue, reaching slightly over $1.2 trillion in 2018.
Overall, we predict a 2017 mortgage origination market of $1.61 to $1.74 trillion – a smaller decline than previously expected – but still a substantial drop from 2016. Refinance activity will continue to decline in 2018; however, a continued increase in purchase mortgages will combine to reach total originations between $1.63 to $1.74 trillion.
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