Freddie Mac is now forecasting back-to-back years of $2 trillion in mortgage loan originations rather than a drop-off in 2020.
Originations have not topped $2 trillion in consecutive years since the end of the housing boom.
Freddie Mac's projected increase in 2020 volume over 2019 is at odds with the latest forecasts from
Housing is expected to remain strong in the near future even as the U.S. faces a likely economic downturn, Freddie Mac said.
"Economic growth has slowed significantly across the globe, but the slowdown has been more muted domestically," Freddie Mac Chief Economist Sam Khater said in a press release.
"In the United States, the slowdown has been caused by a contraction in manufacturing and a decline in business investment, partly due to weakening business confidence and uncertainty around the lack of a trade deal with China. However, the housing market remains on solid ground with housing starts, building permits, existing-home sales and new-home sales all outperforming the broader economy."
The 2019 purchase mortgage forecast was increased to $1.22 trillion from September's $1.17 trillion. Khater currently forecasts $789 billion in refi originations this year, compared with $919 billion the prior month.
For next year, Khater predicts $2.05 trillion in volume, of which $1.27 trillion is purchase business and $785 billion comes from refis.
This marks a change from September's forecast for a $1.82 trillion year in 2020, made up of $1.22 trillion of purchase loans and $603 billion of refinancing.
The Mortgage Bankers Association projects 2020 volume of $1.89 trillion, although Chief Economist Mike Fratantoni said at the
The latest forecast from Fannie Mae predicts there will be $1.86 trillion in originations in 2020, with $1.29 billion of purchase loans and $566 billion in refis.
