Tag: Home Sales

Fannie Mae Forecast Sees Year Ending Strong

Fannie Mae’s Economic and Strategic Research Group releases a forecast each month covering their predictions for the economy and housing market. According to their most recent release, their outlook for full-year economic growth has been revised upward from last month’s projection. Their home-sales growth projection was also revised upward based on an expected end-of-year sales surge. But while the year-end forecasts were increasingly positive, the group sees challenges ahead in 2022. For one, they expect fewer home sales next year due to limited for-sale listings and growing affordability constraints. “According to the ESR Group, the impact of monetary policy tightening to combat inflation will combine with ongoing supply issues and still appreciating home prices to slow sales activity,” the release says. “While the economy picked up steam late in the year, unfortunately, so did inflation, and the market expects the Fed to recalibrate its monetary policy as a result.” Part of that is an expected mortgage rate increase. But while the Fed is likely to raise rates in 2022, they will still remain low by historical standards. (source)


Mortgage Rates Hit Lowest Level In A Month

According to the Mortgage Bankers Association’s Weekly Applications Survey, average mortgage rates fell again last week – marking the third consecutive weekly decline. The drop brought rates to their lowest level in a month, with decreases seen across all loan categories including 30-year fixed-rate mortgages with both jumbo and conforming balances, loans backed by the Federal Housing Administration, and 15-year fixed-rate loans. Despite the drop, however, demand for mortgage loan applications stayed relatively flat from one week earlier. The refinance index – which is generally more affected by rate changes – rose 7 percent, while the seasonally adjusted purchase index fell 5 percent. Michael Fratantoni, told CNBC that demand is down from where it was at the end of last year. “Refi volume is still down sharply from the end of last year, remaining 13 percent below the level from four weeks ago,” Fratantoni said. On the other hand, the number of prospective home buyers applying for loans to purchase homes is just 1 percent below where it was at the same time last year. The MBA’s weekly survey has been conducted since 1990 and covers 75 percent of all retail residential mortgage applications. More here.

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