Freddie Mac has issued its monthly outlook for July, with a focus on what has driven down mortgage rates. It also showed how this is expected to drive home prices in the next year.

Despite the stock market recovering all of its losses — oh and hitting new all-time highs — Freddie Mac believes that the international concerns from the slowing growth in China and the U.K.’s Brexit vote have played a major role in driving mortgages lower.

Freddie Mac’s most recent Primary Mortgage Market Survey showed that the average 30-year fixed-rate mortgage fell to a rate of 3.41%. This is within striking distance of an all-time low. Freddie Mac also said that this should boost housing activity, particularly refinancing activity.

Freddie Mac’s latest economic and housing price outlook is still calling for growth on both fronts (housing and economy). The forecast calls for growth to rebound in the second half of 2016, with gross domestic product (GDP) rising 1.9% in 2016 and then rising 2.2% in 2017.

Where this gets interesting for new home buyers is that Freddie Mac now forecasts lower-than-expected mortgage rates. The monthly forecast said:

In light of recent global pressures, the 30-year fixed-rate mortgage forecast has been revised down for both 2016 (by 30 basis points) and 2017 (by 50 basis points) to 3.6 percent and 4.0 percent, respectively. … Based on these low mortgage rates, expect the refinance share of originations to rise to 49 percent for 2016, 8 percentage points above last month’s forecast. This translates to about $100 billion more in originations, bringing the total for 2016 to $1,825 billion. The house price appreciation forecast for 2016 remains at 5.0 percent, and in 2017, 4.0 percent.

Sean Becketti, chief economist at Freddie Mac, said:

With the U.K.’s decision to exit from the European Union, global risks increased substantially leading us to revise our views for the remainder of 2016 and all of 2017. Nonetheless, the turbulence abroad should continue to create demand for U.S. Treasuries and keep mortgage rates near historic lows; thereby, allowing home sales to have their best year in a decade, along with a boost in refinance activity.

Freddie Mac’s forecast for unemployment, factoring in June versus May data, is now called to average 4.9% in 2016 and 4.8% in 2017.

All in all this is one of those reports that could have been titled “Let The Good Times Roll.”

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