According to Freddie Mac’s newly released Quarterly Forecast, total mortgage originations will reach $1.1 trillion in Q3 2020 and $3.6 trillion for full-year 2020.
For Q3 2020, the GSE forecasts purchase originations to be around $444 billion and refinance originations to be $670 billion. For full-year 2020, purchase originations and mortgage refinance originations will total $1.4 trillion and $2.2 trillion, respectively.
For the coming year, Freddie Mac forecasts purchase originations to remain at $1.4 trillion, while refinance originations are expected to be lower, at $1.2 trillion. Overall, total originations will decline to $2.7 trillion in 2021.
“Even as the economy faces challenges from the coronavirus pandemic, the housing market has been showing strength,” says Sam Khater, Freddie Mac’s chief economist. “Refinance activity is solid and home buyer demand continues, resulting in increased sales and an acceleration in house price growth.”
The average 30-year fixed-rate mortgage is expected to be 3.2 percent in 2020 and 3.0 percent in 2021.
House price growth is expected to increase to an annual rate of 5.5 percent in 2020. In 2021, that rate is expected to be 2.6 percent. Meanwhile, home sales are expected to increase in 2020 to 6.2 million homes and decrease in 2021 to 6.1 million homes.
More information from Freddie Mac’s forecast can be found here.
