The Mortgage Bankers Association has lowered its mortgage origination forecast again and it looks like 2014 could be the slowest year for the industry in 14 years.
The trade group's economists estimate that lenders will originate $1.065 trillion in single-family loans this year, down 39% from 2013.
The last time originations were at this level was in 2000 when lenders made $1.067 trillion in mortgages, according to National Mortgage News’ Quarterly Data Report.
Economists were hoping for a significant pickup in mortgage applications in March and early April when the spring home buying season kicks in.
"That just hasn't happened," said Joel Kan, director of economic forecasting for MBA, in an interview.
Mortgage application activity has increased over the past three weeks, "but this is coming off a really low base and the increases haven't been large enough to boost overall production," Kan said.
Originations fell to $226 billion in the first quarter, from $293 billion in the fourth quarter of 2013, according to MBA estimates. The group predicts that originations will bounce back to $267 billion in the second quarter.
Lenders made $1.75 trillion in single-family loans in 2013.
"You would have to bank on a really big second half of the year for originations to come in at the 2013 level," Kan said Friday.
MBA economists released their first 2014 forecast back in October. It called for $1.18 trillion in loan production. That estimate was ratcheted down to $1.12 trillion in January.