MBA Forecast: Mortgage Originations to Fall 5% to Just Under $2 Trillion in 2027 as 30-Year Rates Stay Above 7%
CHICAGO — Total single-family mortgage origination volume in the United States is expected to decrease 5% to just under $2 trillion in 2027, down from the $2.1 trillion expected in 2026, the Mortgage Bankers Association (MBA) said in its latest Mortgage Finance Forecast, announced on October 11 at the association's 2026 Annual Convention and Expo in Chicago. By loan count, origination volume is expected to decrease 5.6% to 5.0 million loans in 2027 from 5.3 million loans expected in 2026. MBA published further detail on the forecast in its Chart of the Week on October 16.
Purchase originations are forecast to increase 0.8% to $1.42 trillion next year, while refinance originations are expected to decrease 17% to $571 billion. MBA noted that only 23% of borrowers hold mortgage rates above 6%, leaving little to no refinance incentive while market rates remain in the 7% range.
On rates, MBA expects the 30-year mortgage rate to average 7.3% in the fourth quarter of 2026 and remain above 7% through 2027, while the 10-year Treasury yield is forecast to average 5.1% in the fourth quarter of 2026 and remain close to 5% through 2027. "Mortgage rates have recently spiked to their highest level in more than three years, while 10-year Treasury rates have reached their highest levels in 24 years," said Mike Fratantoni, MBA's chief economist and senior vice president for research and industry development. He said mortgage and Treasury rates are likely to come down from their recent peaks but will remain on a higher path than previously forecast, a serious headwind for origination volume for the remainder of this year and into 2027.
MBA projects U.S. economic growth of 1.8% over the next year and expects two additional 25-basis-point rate hikes by the Federal Open Market Committee, one in December of this year and a second in the first quarter of 2027, following the FOMC's 25-basis-point hike in September. The unemployment rate is forecast to rise slightly from its current 4.2% to average 4.3% over the course of 2027. Fratantoni noted substantial uncertainties around the forecast, including the potential for geopolitical or financial market shocks, and said the risks of a recession are elevated.
Joel Kan, MBA's vice president and deputy chief economist, said mortgage rates at current levels have caused a pullback in application activity for both home purchases and refinances, and that buyers still in the market are increasingly turning to adjustable-rate loans or paying points to lower their rates: the ARM share of applications averaged almost 10% over the past month and is forecast to remain over 9% through 2027. Kan added that slower population growth and lower immigration will contribute to lower overall demand for housing, that national home-price growth has slowed to the 2% range, and that MBA expects declining levels of new construction for both single-family and multifamily homes, with national home-price growth decelerating in 2027 before gradually picking up again in 2028.
On industry profitability, Marina Walsh, MBA's vice president and head of industry analysis, said average net production profits for independent mortgage banks remained positive in the second quarter for the fifth consecutive quarter, though still below the historical average of 39 basis points dating from 2008. Among 325 lenders surveyed, the top 20% averaged 122 basis points, or $4,551 per loan originated, in the second quarter of 2026, while the bottom 20% averaged a loss of 76 basis points, or $2,551 per loan. MBA also released an updated forecast for commercial and multifamily originations, expecting commercial real estate finance volume to increase 1% and multifamily volume 2% in 2027.
Published by GSM · USA (original Chinese edition)
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