MCLEAN, VA--(Marketwired - Jul 16, 2013) - Freddie Mac (OTCQB: FMCC) released today its U.S. Economic and Housing Market Outlook for July, recapping the first half the year and giving a look down the road on expectations for the markets in the second half. A short preview video and the complete July 2013 U.S. Economic and Housing Market Outlook are available here.
- The labor market added 1.2 million net new jobs through June, marking the best first half of the year since 2005 with construction contributing 100,000. Expect this same pace to continue in the second half.
- Seasonally adjusted, single-family house prices were likely up about 5 percent in national indexes in just the first half of 2013. The blistering pace in house prices is unlikely to continue, but rather moderate and grow at a rate closer to 3 to 4 percent in the second half, for a total gain of 8 to 9 percent for the calendar year.
- Through May, home sales were on their best first-half year pace since 2007. Existing home sales were up over 10 percent compared with the first five months of 2012, and new home sales were up 29 percent. In the second half of the year, expect sales (new and existing) to be up an additional 2 percent and starts up 12 percent relative to the first half.
- In the first quarter of 2013 about 65 percent of newly completed apartments were rented, up substantially from 2009 when absorption rates were about 50 percent. Good fundamentals have driven the renaissance in apartment construction: Through the first five months of 2013 multifamily housing starts were near a 300,000 annual pace, about the same as the average pace during 1997-2006.
- Recent Taper Talk has led to a jump in interest rates with the 30-year fixed-rate mortgage up a full percentage point since mid-May. Expect rates to gradually move higher, ending the year around 4.6 to 4.7 percent.
Attributed to Frank Nothaft, Freddie Mac vice president and chief economist.
"The housing recovery keeps chugging along despite the recent market hysterics around Taper Talk which caused mortgage rates to jump over the past month. We won't know the immediate impact on the pop in mortgage rates for another couple months. However, we don't expect them to stall the housing recovery because demand is strong, supply is limited and housing affordability remains strong in most markets for most families."
Freddie Mac compiles data on major economic, housing and mortgage market indicators and offers forecasts based on those indicators.
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