MBA’s Mike Fratantoni on next year’s purchase market
Today’s HousingWire Daily features a rerun episode of an exclusive interview with Mike Fratantoni, the Mortgage Bankers Association’s chief economist and senior vice president of Research & Technology. As we wrap the year, we are rerunning our favorite episodes from the year.
In this episode, Mike Fratantoni discusses the MBA’s mortgage forecast for 2021, which includes revised estimates for the third and fourth quarter of 2020, as well as predictions for next year’s purchase market.
Here is a small preview of today’s interview with Mike Fratantoni. The transcript below has been lightly edited for length and clarity:
HousingWire: The MBA has made upward revisions to its 2020 and 2021 origination estimates. Can you discuss this data and possibly why the origination volumes are expected to heat up?
Mike Fratantoni: As folks in the industry know, 2020 has just been an extraordinary year. So, we expect it will have one of the largest refinance and origination volumes ever. As you [previously]mentioned, some of the incoming data was surprisingly strong, as we saw a full percentage point drop in the unemployment rate going from September to October. We also saw existing home sales reach their highest level since 2005, and new construction climb 30% in terms of annual single-family housing starts. Currently, we’re seeing home prices boom across the country with the median price of an existing home increasing more than 15% on a year-over-year basis. All of that is feeding into stronger purchase origination numbers, and with record-low mortgage rates, that really is feeding this extraordinary refinance wave.
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