Total originations of U.S. mortgages on one-to-four family homes is expected to rise to $1.682 trillion in 2019, up from $1.643 trillion in 2018, on resilient home sales, the Mortgage Bankers Association’s chief economist said.
A modest pickup in home sales this year would help raise issuance of loans for that category to $1.244 trillion from $1.185 trillion last year, Michael Fratantoni told reporters at a recent press conference during MBA’s National Secondary Market conference.
Meanwhile, mortgage applications increased 2.4 percent from one week earlier, according to data from the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey for the week ending May 17, 2019.
The Market Composite Index, a measure of mortgage loan application volume, increased 2.4 percent on a seasonally adjusted basis from one week earlier. The Refinance Index increased 8 percent from the previous week.
"Mortgage rates fell for the fourth straight week, with the 30-year fixed rate mortgage hitting its lowest level since January 2018, leading to a rebound in refinances. The refinance index increased 8 percent to its highest level in over a month, and once again there was an increase in average refinance loan sizes, as borrowers with larger balances responded accordingly to lower rates," said Joel Kan, MBA's Associate Vice President of Economic and Industry Forecasting.
"Purchase activity declined again, but remained around 7 percent higher than a year ago. We're keeping a close eye on whether there may be some adverse effects of the ongoing global trade disputes on overall demand. Some potential homebuyers may be delaying their home search until there's more certainty."
The refinance share of mortgage activity increased to 40.5 percent of total applications from 37.9 percent the previous week.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($484,350 or less) decreased to 4.33 percent from 4.40 percent.
The average contract interest rate for 15-year fixed-rate mortgages remained unchanged at 3.78 percent.
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