Mortgage rates are anticipated to remain at an all-time low for the first half of 2013, then slowly rise during the second half of the year, although they will remain below 4%, reported Freddie Mac.
On the same day that Fannie Mae released its National Housing Survey, showing increased consumer confidence in the housing industry, Freddie Mac revealed its U.S. Economic and Housing Market Outlook for December.
The housing outlook predicts what some of the market features are expected to look like in 2013.
“The last few months have brought a spate of favorable news on the U.S. housing market with construction up, more home sales, and home-value growth turning positive,” said Frank Nothaft, vice president and chief economist of Freddie Mac.
Property values are expected to gain strength with most house price indexes increasing as much as 3% next year.
Housing starts are expected to jump to a net 1.20 to 1.25 million household increase in 2013, with starts up around the 1 million annualized pace by the fourth quarter.
Vacancy rates should fall significantly for both apartments and single-family homes for sale, dropping to 2002 to 2003 levels.
The 2012 refinance boom will continue into early 2013, suggesting single-family mortgage originations may decline by as much as 15%, while multifamily lending is believed to rise approximately 5%.
“This has been a big change from a year ago, when some analysts worried that the looming ‘shadow inventory’ would keep the housing sector mired in an economic depression. Instead, the housing market is healing, is contributing positively to GDP and is returning to its traditional role of supporting the economic recovery,” said Nothaft.
