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MBA Forecasts Purchase Originations to Increase to $1.2 Trillion in 2018

MBA Forecasts Purchase Originations to Increase to $1.2 Trillion in 2018

Refinance Activity Expected to Continue Decline

WASHINGTON, D.C. (January 30, 2015) – DENVER, CO (October 26, 2017) – (RealEstateRama) — The Mortgage Bankers Association announced today that it expects to see $1.2 trillion in purchase mortgage originations during 2018, a 7.3 percent increase from 2017.  In contrast, MBA anticipates refinance originations will decrease by 28.3 percent from 2017, to approximately $430 billion.  In total, mortgage originations will decrease to $1.60 trillion in 2018 from $1.69 trillion in 2017.

For 2019, MBA is forecasting total originations to rebound to $1.64 trillion, with purchase originations of $1.24 trillion and refinance originations of $395 billion.

“We are projecting that home purchase originations will increase at a faster clip in 2018, nearly double the rate that they increased in 2017. The housing market has been hamstrung by insufficient supply, with inventories of homes remarkably low given the home price growth we have experienced.  The job market remains strong, demographic trends are quite favorable, mortgage credit is becoming more available to qualified borrowers, and home prices should continue to rise. All the pieces are in place for stronger growth in 2018 and beyond,” said Michael Fratantoni, MBA’s Chief Economist and Senior Vice President for Research and Industry Technology.

“Our projection for overall economic growth is 2.0 percent for 2018, slowing slightly to 1.9 percent in 2019 and 1.8 percent in 2020. We still expect long run growth potential in the US to be somewhat lower, as productivity gains have been persistently slow.

“Although inflation remains low, a tight job market is likely to increase inflationary pressures in the near term.  We expect the Fed will raise rates in December 2017, 3 times in 2018, and twice in 2019.   The Federal Reserve has begun reducing the its holdings of Treasury securities and mortgage backed securities, and this will put additional, modest upward pressure on mortgage rates.  We expect that the 10-Year Treasury rate will stay below three percent through the end of 2018, and 30-year mortgage rates will stay below 5 percent.

“We forecast that monthly job growth will average 125,000 per month in 2018, down from about 150,000 per month in 2017, and that the unemployment rate will decrease to 4.0 percent by the end of 2018.” Fratantoni said.

In addition to the updated forward-looking forecast, MBA upwardly revised its estimate of originations for 2016 to $2.05 trillion from $1.89 trillion, to reflect the most recent data reported in the 2016 Home Mortgage Disclosure Act (HMDA) data release.

You can download a copy of MBA’s updated Mortgage Finance Forecast  and a copy of MBA’s updated Economic Forecast here.

Ali Ahmad

(202) 557- 2727


The Mortgage Bankers Association (MBA) is the national association representing the real estate finance industry, an industry that employs more than 280,000 people in virtually every community in the country. Headquartered in Washington, D.C., the association works to ensure the continued strength of the nation’s residential and commercial real estate markets; to expand homeownership and extend access to affordable housing to all Americans. MBA promotes fair and ethical lending practices and fosters professional excellence among real estate finance employees through a wide range of educational programs and a variety of publications. Its membership of over 2,400 companies includes all elements of real estate finance: mortgage companies, mortgage brokers, commercial banks, thrifts, Wall Street conduits, life insurance companies and others in the mortgage lending field.


Mortgage Bankers Association
1331 L Street, NW
Washington, DC 20005

Phone: (202) 557-2700