Report: Residential Property Mortgage Originations to Decline

The Mortgage Bankers Association released today projections for the mortgage production market. The trade group said that the decline in mortgage originations for residential properties should continue to decline in the first half of the year while the 30-year fixed mortgage yield should inch somewhat higher. “Residential investment is expected to decline further through the first half of 2007 but at a diminishing pace,” said Doug Duncan, chief economist at MBA. “Economic growth should accelerate later this year to a trend-like pace as the drag from the housing sector wanes.” Duncan expects the Fed to keep rates steady at the current 5.25 percent, and the fixed rate mortgage percentage, now at 6.2 percent, to rise to 6.5 percent by the third quarter.