Freddie Mac is out with its U.S. Economic and Housing Market Outlook for March. The GSE’s report shows signs that the housing market is “awakening from its depression-like condition of the past few years and beginning, though slowly, to make a nascent recovery.”
The outlook is calling several conditions here as stronger economic growth in 2012 will translate into a further reduction in the unemployment rate below 8.3 percent. Freddie Mac also noted that home sales and originations forecasts have been revised upward based on the economic growth. The GSE has also warned that 30-year fixed-rate mortgage rates are expected to rise gradually throughout 2012 to about 4.5 percent. In short, that is well over a 50 basis point rise from the mortgage lows seen in recent months. As far as new rental construction for 2012, that is likely to be the highest since 2005 if the current pace is maintained.
Today’s report noted, “Even with a 1 percent dip in new and existing homes sales in February, median sales prices moved up 0.3 percent on a year-over-year basis, a hint that home values may be stabilizing in more markets around the nation.”
JON C. OGG