Freddie Mac Advises Buyers to Move Quickly
Freddie Mac recently cited a number of favorable opportunities for the housing sector but stressed the need for consumers and businesses to take advantage of them sooner rather than later – they may be limited.
According to Freddie Mac’s January 2015 U.S. Economic and Housing Market Outlook, one big positive for housing currently is the attractive potential for refinancing. Looking at conventional 30-year fixed mortgage agency mortgage-backed securities (MBS), approximately $361 billion had a 4.5 percent coupon while another $479 billion had a coupon higher than 4.5 percent. Many had a rate higher than 5 percent, providing borrowers with plenty of incentive to refinance at current 30-year fixed annual rates.
Job growth, though, is the most important positive tailwind for housing cited in Freddie Mac’s report. Payrolls expanded by an average of 246,000 a month last year versus just 194,000 a month in 2013, the Bureau of Labor Statistics (BLS) reports. The unemployment rate, meanwhile, dipped 1.1 percentage points from January through December to 5.6 percent – the lowest level it has been in six and a half years. That drop reduced the amount of unemployed persons in the United States by 1.7 million, notes BLS researchers.
Source: “Freddie Mac advises buyers to move quickly,” Florida Realtors