Mortgage origination volume reached nearly $1.8 trillion in 2015 – an increase of about 30% compared with 2014, according to CoreLogic’s MarketPulse report.
“Mortgage originations rebounded last year,” writes Molly Boesel, senior economist for CoreLogic, in the report, which shows that refinances increased 29% compared with 2014 (dollar volume increased 44%), while purchases increased 13% (dollar volume increased 18%).
Each year, CoreLogic compares the origination totals reported to the Home Mortgage Disclosure Act (HMDA) database with its own industry-derived data to see how the two compare. For 2015, the HMDA shows about $1.7 trillion in originations.
Boesel points out that some smaller lenders are exempt from reporting to the HMDA, so that can account for a 4% average difference between the two.
“On average, between 2006 through 2014, the CoreLogic estimate of mortgage origination dollar volume was one percent below the HMDA estimate,” Boesel writes. “Therefore, the $1.7 trillion is a slightly lower level of what we expect the HMDA release to report for 2015.
“Some lenders are exempt from HMDA reporting, and many analysts estimate that lenders reporting under HMDA cover about 95 percent of the mortgage market,” she continues. “Therefore, we estimate that total market originations – after accounting for under coverage – was probably closer to $1.8 trillion.”
Meanwhile, government-sponsored enterprise Freddie Mac recently forecast that mortgage originations could top $2 trillion in 2016.
“At the current pace, we’re likely to see the mortgage market top $2 trillion in originations for the first time since 2012,” says Sean Becketti, chief economist for Freddie Mac, in the firm’s most recent Outlook report. “And unlike in 2012, when the market was driven largely by refinances, today’s market is more balanced between home refinances and purchases – nearly 50-50. This is good news for home sales, as we’re likely to see the best year in home sales in a decade. This is a good sign for the housing market as it continues to be an even brighter spot in the economy.
“However, the housing market still has challenges, which is reflected in our housing starts forecast,” Becketti adds. “Low levels of inventory across many markets will continue to put upward pressure on house prices for the foreseeable future.”