Freddie Mac has reported that the US housing market would remain solid as Freddie’s mortgage origination outlook hovered at $2 trillion for the rest of the year.
The projected surge in refinance activity will drive single-family mortgage originations to $789 billion and $785 billion in 2019 and 2020, respectively, Freddie Mac predicted.
Meanwhile, the GSE said to expect modest gains in home sales and house prices to boost purchase mortgage originations to $1.2 trillion this year and $1.3 trillion in the coming year.
Overall, annual mortgage origination levels will stay at $2 trillion in 2019 and inch up to $2.1 trillion in 2020, according to GSE. The rate for the 30-year mortgage will be 3.7% for the remainder of 2019 before ticking up to 3.8% in 2020.
“Economic growth has slowed significantly across the globe, but the slowdown has been more muted domestically,” said Freddie Mac Chief Economist Sam Khater. “In the United States, the slowdown has been caused by a contraction in manufacturing and a decline in business investment, partly due to weakening business confidence and uncertainty around the lack of a trade deal with China.”
The pace of house price growth is projected to continue slowing this year, appreciating at 3.3% in 2019 and 2.8% in 2020. As of August, the CoreLogic Home Price Index was 3.6% year over year.
Freddie Mac expects home sales to grow to 6 million in 2019 before increasing to 6.1 million in 2020. Pending home sales posted a 1.5% gain in September, according to the National Association of Realtors.