Dive Brief:
-
Freddie Mac last week released an optimistic report for housing, predicting that 2015 will be “the best year for home sales since 2007.”
-
In their latest U.S. Economic & Housing Market Outlook, Freddie Mac economists said an inevitable mortgage interest rate increase later this year will “not be substantial” and should level out to about 4.2% by the end of the year.
-
The report put 2015 home sales at 5.6 million in 2015, and housing starts at 1.8 million. Low inventories of homes for sale, the economists said, will continue to push home prices up—by about 3.9% this year.
Dive Insight:
Freddie Mac’s optimistic housing outlook came as the agency revised its forecast for economic growth downward because of a slower-than-expected final quarter of 2014 and first quarter, so far, of 2015.
Overall, the economists said that even if the Fed raises short-term interest rates later this year, they don’t foresee long-term rates, such as mortgage rates, rising much. And these low mortgage rates will create a positive impact on the housing market.