Florida Mortgage Blog

Freddie Mac Gives their Estimate of 2013

December 12th, 2012 2:40 PM by Preston Ware

Recently in it's December report, Freddie Mac made suggestions on what the housing market might look like in 2013. Overall, Freddie Mac expects to see a continuation of 2012 positive trends.

For one, it was estimated that property values should still rise into the next year and are likely to increase by 2 to 3 percent.

The market should also see more households which is good for demand, with household formation expected to expand from a net 1.20 million to 1.25 million.

Long-term mortgage rates, which have been hovering at record lows, are forecast to maintain this trend into the first half of next year, but then rise in the second half. Interest rates are expected to stay below 4%

The forecast for the rental industry was positive as well. Aggregate vacancy rates for the multifamily and single-family for-sale market are projected to come down to 2002-2003 levels as household formation outpaces new construction.

For mortgage bankers such as myself, originations are expected to fall by 15 percent as refinances slow down compared to 2012. On the other hand, multifamily lending is expected to grow by about 5 percent.

“The last few months have brought a spate of favorable news on the U.S. housing market with construction up, more home sales, and home-value growth turning positive. This has been a big change from a year ago, when some analysts worried that the looming ‘shadow inventory’ would keep the housing sector mired in an economic depression,” said Frank Nothaft, Freddie Mac vice president and chief economist. “Instead, the housing market is healing, is contributing positively to GDP and is returning to its traditional role of supporting the economic recovery.”
Posted in:General
Posted by Preston Ware on December 12th, 2012 2:40 PM

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