Economists at the Mortgage Bankers Association and mortgage giants Fannie Mae and Freddie Mac are predicting that growth in housing sales and price stability will boost demand for purchase mortgages next year.
Because real estate agents' commissions are tied to the selling price of homes in which they represent buyers and sellers, trends in purchase loan originations correlate well with commissions, although many sales during the downturn have been all-cash deals to investors who also pay agent commissions.
The Mortgage Bankers Association expects purchase loan originations to grow by 16 percent next year, to $585 billion from an estimated $503 billion in 2012.
Growth in new-home sales, modest home price increases, and more financed, owner-occupied sales rather than cash investor sales will drive 2013 purchase originations, said Jay Brinkmann, MBA's chief economist, in a statement.
In their latest forecast, Fannie Mae economists predict sales of new and existing homes will climb by 4.2 percent next year, to 5.19 million homes, with even more dramatic 11 percent growth in purchase loan originations, to $567 billion. That growth would come on top of projected 9 percent growth in 2012 home sales.
"The strength in the recent home price trend reflects both improving fundamentals as well as seasonality, which causes the share of distressed sales to decline in the spring and summer months," Fannie Mae economists Doug Duncan, Orawin Velz and Richard Koss said in their latest economic outlook. "We expect to see some deterioration in home prices as we move into the winter months, but we continue to believe that prices reached bottom in the first of quarter of this year."http://www.inman.com/news/2012/10/25/mortgage-giants-predicting-growth-in-2013-home-sales
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