Skip to Page Content | Skip to Site Navigation | Skip to Section Navigation

2014: The Emerging Purchase Market

November 2013 U.S. Economic and Housing Market Outlook

The first purchase-dominated market since 2000

MCLEAN, VA--(Marketwired - Nov 19, 2013) -  Freddie Mac (OTCQB: FMCC) released today its U.S. Economic and Housing Market Outlook for November showing that the major shift for the coming year will be a transition from a refinance-dominated mortgage market to the first purchase-dominated market the industry has seen since 2000. A short preview video and the complete November 2013 U.S. Economic and Housing Market Outlook are available here.

Outlook Highlights

  • Expect economic growth in the 2.5 to 3.0 percent range, more than 0.5 percentage points better than is projected for 2013 with the unemployment rate falling below 7 percent, perhaps by mid-2014.
  • Interest rates are expected to rise gradually throughout 2014 with the 30-year fixed-rate mortgage ending the year near 5 percent with affordability still strong in most markets. However, rising rates will hinder affordability in high-priced markets.
  • Projecting housing starts to rise to a 1.15 million pace in 2014, which should help to create around 700,000 new jobs and quicken the pace of economic growth.
  • Gains in home sales will be limited by continuing tight inventory in many markets, but anticipate sales to rise about 5 to 6 percent in 2014 from 2013 levels.
  • Expect home values to continue rising but at a more moderate pace, around 5 to 6 percent annualized. And expect multifamily property investments to continue to be relatively attractive as we enter 2014, compared with the first decade of the 2000s, based on the Freddie Mac Multifamily Investment Index.

Quote
Attributed to Frank Nothaft, Freddie Mac vice president and chief economist.

"With the close of 2013 will also come a major transition in the housing finance industry. For the first time since 2000, we're going to see the mortgage market dominated by purchase activity as the refinance share drops below 50 percent. And with mortgage rates rising, we're also going to see the home-sales gains as well as the impressive house price growth begin to moderate to more sustainable levels."

Freddie Mac was established by Congress in 1970 to provide liquidity, stability and affordability to the nation's residential mortgage markets. Freddie Mac supports communities across the nation by providing mortgage capital to lenders. Today Freddie Mac is making home possible for one in four home borrowers and is one of the largest sources of financing for multifamily housing. For more information please visit www.FreddieMac.com. Twitter: @FreddieMac








 

The financial and other information contained in the documents that may be accessed on this page speaks only as of the date of those documents. The information could be out of date and no longer accurate. Freddie Mac does not undertake an obligation, and disclaims any duty, to update any of the information in those documents. Freddie Mac's future performance, including financial performance, is subject to various risks and uncertainties that could cause actual results to differ materially from expectations. The factors that could affect the company's future results are discussed more fully in our reports filed with the SEC.


Print Email RSS            
         

Get RSS Feed

Sign Up For Email Alerts

Connect With Us

Media Contact

For press inquiries only:

General
E-mail
(703) 903-3933

Non-press inquiries

Get the Picture

How are our local, state, and national housing markets faring? MiMi, our new housing index, explains.

Our Commitment

Our commitment

See how our commitment to you and the nation is moving housing forward.

Search News Room

Back to Top