Fannie Mae Forecasts Lower Mortgage Rates and Cooler Home Price Growth
Read the full story → Scotsman Guide
Fannie Mae revised its housing outlook in July, projecting lower mortgage rates by year-end and a deceleration in home price growth. This marks a significant shift from earlier in the year, reflecting improving inflation data and expectations of a softer rate environment.
Key revisions include a drop in the expected 30-year fixed rate to 6.4% by Q4, and annual home price growth slowing from 6.8% to 4.8%. Purchase mortgage originations were also revised upward to $1.4 trillion for 2025, highlighting optimism about buyer activity.
The updated outlook suggests that affordability conditions may gradually improve, allowing sidelined buyers to re-enter the market. However, tight inventory and elevated home prices remain critical obstacles.
Loan Officer Insight: Be proactive. Lower rate projections mean more purchase power later this year. Start prepping clients now to lock in at the right time, and use the price moderation forecast as an anchor for value conversations.
Realtor Insight: Emphasize the window of opportunity. Sellers may need to adjust expectations, while buyers should stay engaged with preapprovals and regular check-ins.
Trump: Powell Likely to Cut Rates Soon
Read the full story → CNBC
In a recent interview, former President Donald Trump stated his belief that Federal Reserve Chair Jerome Powell is “ready to start lowering rates,” citing slowing inflation and rising pressure from political and economic forces.
While Powell and the Fed have not formally signaled a rate cut, market participants are already pricing in the potential for a move by fall 2025. This speculation is further fueling optimism in mortgage markets and boosting investor sentiment.
If rate cuts materialize, the impact on borrowing costs could be substantial—especially for purchase and refinance activity. But professionals should stay grounded in economic data, not political commentary.
Loan Officer Insight: Keep your clients focused on the facts, not headlines. Rate cut talk creates buzz, but clear strategies around lock windows, refi opportunities, and payment flexibility build real trust.
Realtor Insight: Messaging matters. Even if cuts aren’t imminent, buyer perception of future affordability can reignite interest. Use this to spark conversations with fence-sitters.
GSE Reform Buzz Sends Fannie & Freddie Stocks Higher
Read the full story → Barron’s
Fannie Mae and Freddie Mac shares surged this week amid renewed speculation that the Biden administration may advance reforms to end the companies’ 16-year conservatorship. Though no formal action has been taken, investor optimism grew following remarks from regulators and lawmakers.
PulteGroup’s stock also saw gains as builder sentiment continues to rise in light of lower rate forecasts and policy stability. The overall takeaway? The market sees structural shifts ahead.
Any major movement with GSE reform would have ripple effects across the mortgage landscape—from underwriting policy to secondary market pricing.
Loan Officer Insight: Keep tabs on how GSE policy could evolve. Loan guidelines, LLPAs, and eligibility rules could shift rapidly if reform talks progress. Position yourself as a steady voice amid uncertainty.
Realtor Insight: Use the stock movement and policy buzz as an opening to discuss the broader housing finance system with clients who are more financially savvy. It’s a great way to show deeper industry knowledge.
Loan Officer’s Perspective
- Revisit preapprovals: Lower rates ahead mean buyers’ budgets could expand. Stay ahead of the curve.
- Prep rate watchers: Use current volatility as a reason to start now, not wait.
- Track GSE shifts: Policy reform can reshape lending norms—stay informed, stay competitive.
Realtor’s Perspective
- Educate on price moderation: Fannie’s 4.8% projection can help calm buyer FOMO.
- Leverage rate buzz: Use Trump’s rate cut comments to reignite conversations.
- Discuss macro trends: Builder and GSE stock gains offer context to anchor client strategy.