CNBC reports that the net profit outlook for mortgage lenders in the second quarter of 2019 was positive for the first time in three years.
“Lenders are signaling strong demand-driven mortgage market dynamics, with optimism for both their consumer demand and profitability outlooks reaching multi-year highs,” said Doug Duncan, Fannie Mae senior vice president and chief economist. “For the first time in more than two years, lenders who are reporting or expecting growing refinance demand became the majority.”
Mortgage rates are down dramatically from the November highs. The average rate on the 30-year fixed for conforming loan balances was just over 5% last fall but has now fallen to just below 4%.
Lenders expect the surge in refinances to continue. The net share expecting demand growth is now positive for the first time since the third quarter of 2016 for loans eligible to be sold to Fannie Mae and Freddie Mac (known as the GSE’s), according to the Fannie Mae survey.
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