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.
