Monday, April 18, 2011
Freddie-Mac Expects Housing Market to Spring Forward
Our number one backer of residential home mortgages has just released it's forecast for the spring Real Estate Market. We've picked out some major highlights:
Unemployment declined for the fourth straight month to 8.8 percent, and net employment sprung up by 216,000, the largest monthly job gain since last May and a hopeful signal that the labor market was warming up. On a March-over-March basis, employment was up by 1.3 million…Driven by low mortgage rates and home prices well below peaks, homebuyer affordability is at the highest level in at least forty years, according to the National Association of Realtors®. Indeed, sales contract signings for existing homes were up in February, positioning the market for a bounce up in settlements during the second quarter, the traditional time for the seasonal upswing in sales…..Look for home sales to be up about 5 percent in 2011 compared with 2010, on a calendar year basis…. short-term rates will remain low and supportive of household borrowing. The coupon difference between 30-year and 15-year fixed-rate mortgages has gradually widened to about three-quarters of a percentage point….The rental market should continue to have gradually warmer market conditions as well, with rents continuing to pickup and vacancies dipping.