The Mortgage Bankers Association came out with their projections for 2011 and 2012 yesterday and their numbers were very interesting.  Years 2008-2010 were clearly difficult for the mortgage industry.  The financial meltdown left only one real buyer in the secondary loan market: the U.S. Government through Fannie Mae, Freddie Mac and The Federal Housing Administration via FHA insured loans.  The jumbo market, once the most lucrative because it offered a yield return to the investor higher than that of the government, simply evaporated.  And while the jumbo market has come back to an extent, the landscape has been forever altered.

Over the past several weeks I have been talking predictions.  After all, I like everyone else, find my crystal ball a bit foggy and am looking for any indication of a sunnier road ahead for our economy and in particular our real estate market.  There has been so much made of the impending avalanche of foreclosures coming to the market after many of the banks halted foreclosures, in order to examine their internal process and ensure Congress doesn’t bring down the hammer on them for bad faith, fraud and in general incompetence.  In fact when I talk with my fellow Realtors there remains no consensus.  The largest camp is still towards the downside than up by a pretty large margin.  This could be that a majority the Realtors who’ve survived this market, are representing banks and investors, all of whom see the market as weakening.  I on the other hand have remained steadfastly positive, but am clearly in the minority.

So what did the Mortgage Bankers Association say yesterday?  They predict a 30% increase in purchase volume from 2010 to 2011.  Further, they predict an additional 40% increase in 2012!  Admittedly, this is on the heels of a dismal 2010 which was off more than 50% from 2008, but this is our new reality.

So there it is; another prediction to the upside.  If their numbers are correct, they are predicting an 82% increase over the next two years.  You can call me myopic; you can call me an optimist; but my belief is that the economy will lead the way and it’s getting better and that’s better for  housing and that’s better for us and clearly when a trade group like the Mortgage Bankers Association comes out with numbers like this, I myself, stand up and take notice.