Freddie Mac and the Mortgage Bankers Association agree that 2010 has been the best year for mortgage refinances since 2006 AND that 2019 has been the best year for purchases since 2006.
Freddie Mac provided the specifics…refinance originations are expected to come in at $846B in 2019. In 2020, refinance originations are anticipated at $834B. Both of these +$800B figures are more than $300B more in refinancings than in 2018.
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Freddie also suggested that the number and dollar totals for refinance originations would go down starting next year simply because most homeowners who qualify have already completed the refinance process.
Forecasting interest rates at 3.8% through 2019 AND into both 2020 and 2021, Freddie Mac foresees purchase originations exceeding the expected 2019 $1.255T total in both 2020 (1.299T) and 2021 ($1.369T). Freddie also foresees sales volume rising in both 2020 and 2021. With sales volume expected to hit 6M homes in 2019, Freddie Mac foresees 6.1M home sales in 2020 and 6.2M home sales in 2021.
Freddie Mac anticipates home price growth to slow over the next years with annual rates of 3.2%, 2.9%, and 2.1%, respectively in w019, 2020, 2021.
According to Freddie Mac’s chief economist, Sam Khater, “The economy has seen increased volatility in November 2019 as hopes for a favorable resolution to the trade dispute have recently waned. However, given low interest rates, modest inflation and a solid labor market, the US housing market continues to stand firm, so, our forecast (for 2020) is for the housing market to maintain momentum over the next two years.”
Thanks to HousingWire’s Ben Lane for source data.