7 key takeaways from MBA Secondary '17

May 3, 2017 5:48 PM

From housing finance reform to the latest economic projections, here's a look at the biggest stories and best insights from this week's Mortgage Bankers Association National Secondary Market Conference in New York.

Housing reform becomes urgent as GSEs' capital buffer nears zero

No matter what form government-sponsored enterprise reform takes, Federal Housing Finance Agency officials are stressing that it should account for the fact that the GSEs' capital buffer will soon hit zero.

David "Dave" Stevens, president and chief executive officer of the Mortgage Bankers Association (MBA), listens during an interview in Washington, D.C., U.S., on Wednesday, May 1, 2013. Democratic and Republican lawmakers have been pushing for changes at the FHA since a November actuarial report said its reserve fund for bad loans may require a taxpayer subsidy of as much as $16.3 billion in fiscal-year 2013, the first time in its 79-year history that it wouldn't be self-supporting. Photographer: Andrew Harrer/Bloomberg *** Local Caption *** Dave Stevens

Andrew Harrer/Bloomberg

MBA's Stevens slams calls to 'recap and release' GSEs

MBA President David Stevens is confident that housing finance reform will move forward under the Trump administration, but criticized calls to simply let the government-sponsored enterprises recapitalize and be returned to shareholders without additional reforms.

David Lowman chief executive officer of Chase Home Lending, speaks at a hearing by the Senate Banking Committee to investigate allegations of improper and fraudulent mortgage servicing and foreclosure processing practices in Washington, D.C., U.S., on Tuesday, Nov. 16, 2010. Photographer: Joshua Roberts/Bloomberg

Joshua Roberts/Bloomberg

GSEs want to do more single-family rental financing

Fannie Mae and Freddie Mac will continue to pursue opportunities for the government-sponsored enterprises to provide liquidity to the single-family rental market, despite opposition from mortgage and real estate industry groups.

Model of cardboard home with key and dollar money. House building, insurance, housewarming, loan, real estate, cost of housing or buying a new home concept.

Photographer:Julia Sudnitskaya/juliasudnitskaya - Fotolia

Consensus on total origination volume…

The chief economists for the MBA, Fannie Mae and Freddie Mac — Mike Fratantoni, Doug Duncan and Sean Becketti — have similar projections for 2017 volume: $1.58 trillion, $1.55 trillion and $1.59 trillion, respectively.

Real Estate Home Values Going Up Chart

David Gn/David Gn - Fotolia

…But not on purchase volume

But Freddie Mac projects $1.12 trillion in purchase volume this year, $4 billion more than the MBA and $6 billion more than Fannie Mae. Purchases could go higher if more supply came on the market, Becketti said.

mortgage application form with a mini house for real estate

khz - Fotolia

A slower pace of purchase app growth

The MBA dialed back its purchase outlook based on its Weekly Application Survey, Fratantoni said. At this time last year, purchase application volume was 10% to 15% ahead of where it was in 2015. In 2017, purchases are just 1% to 6% ahead of the same week in 2016.

Arrow heads, symbolizing rising property, finance, tax or mortgage rates.

Ian Milburn

Consumers worried about price increases

Recent results in Fannie Mae's Home Purchase Sentiment Index survey showed "a movement upward in sales this year but not a strong movement upward," Duncan said. "People are now starting to register concerns about prices. It's becoming a factor towards the sentiment of buying a house."