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National Mortgage Professional
Feb 25, 2009

iEmergent announces first quarter update to 2009-2013 Mortgage Volume Forecasts based on $800 billion stimulus billMortgagePress.comiEmergent, statistics, mortgage volume forecasts, market research, Homeowner Affordability and Stability Plan, Dennis Hedlund iEmergent, a Des Moines, Iowa-based market research, forecasting and advisory services firm for the financial services, mortgage and real estate industries, issued a first-quarter update to its formal 20092013 Mortgage Volume Forecast that factors in the impact of the $800 billion stimulus spending bill. This update provides lending details regarding expected loan volumes and market behavior at the national, state, county and local community levels. The continued downward spiral in the overall health of the U.S. economy has triggered massive government intervention to halt the economic slide but will have considerable impact on the lending environment during the next five years. The Q1 forecast anticipates a slight increase in total purchase volume compared to iEmergent's previous 2009 forecast. It also represents a positive change of nearly 55 percent in projected refinance volume for the year. Highlights of the updated national forecast for 2009 home financing opportunities for lenders include: • Total purchase volume: 4.415 million loans for $735 billion • Refinance volume: 5.125 million loans for $916 billion • Total mortgage volume: 9.540 million loans for $1.651 trillion The slight increase in purchase volume reflected in the updated 2009 forecast is based on the expectation that the $800 billion stimulus spending and the recently announced "Homeowner Affordability and Stability Plan," containing homebuyer tax credits, major initiatives focused on job creation and aggressive steps toward foreclosure prevention should produce a positive impact on the housing market during 2009. The projected 55 percent growth in refinance volume from iEmergent's forecasts of five months ago is explained by the expectation that Financial Stability Plan solutions will maintain downward pressure on mortgage rates, unfreeze credit and slow the rate of home price declines as the year progresses, thereby creating a stronger refinance market. However, the projected increase in refinances could likely be offset by unemployment, uncertainty and consumer cynicism about the broader U.S. economy, and the eventual halt of interest-rate decline as the federal deficit forces mortgage rates higher by the end of the year. "Despite the variety of actions being taken to create and save jobs, reduce the number of foreclosures, thaw frozen credit markets and stabilize home prices, lenders should be prepared for volumes in many of their local markets and communities to remain weak and unstable for much of 2009. The impact of these many stimulus actions will not be instantaneous," said Dennis Hedlund, president of iEmergent. "It will take time to stabilize the housing mess, restore credit and re-build economic momentum. The current refinance wave is not a magic bullet for lenders. We expect refinance volumes to be very volatile throughout the year, causing many response and service problems. Rather than wait for more rescue solutions, artificially low mortgage rates or more extensive government investments and guarantees to stabilize communities, lenders need to work harder to develop intelligent and active strategies to reach, attract, capture and service purchase homebuyers more effectively and efficiently no matter how much turmoil exists in the market. Four and a half million purchase loans is not a total collapse. More than ever, lending is local; thats why 'knowing the numbers' of how their local mortgage markets are changing is essential if they expect to improve their profitability, and like the communities they serve, survive and thrive." iEmergent's comprehensive community forecast tables can be configured in any combination of markets to represent the markets of interest to any type or size of mortgage lender. The tables are equipped with interactive tools that allow lenders to utilize data to assess mortgage lending opportunities, develop business strategies, make growth decisions and estimate the strengths and weaknesses of their current positions in distinct markets. For more information, visit www.iemergent.com.
Published
Feb 25, 2009
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