Next year will be a lot like 2017 in key areas, according to FreddieMac.
Looking ahead to 2018, FreddieMac (otherwise known as the government-sponsored Federal Home Loan Mortgage Corp.) announced in late September that “the economic environment remains favorable for housing and mortgage markets. For several years, we have had moderate economic growth of about two percent a year, solid job gains, and low mortgage interest rates. We forecast those conditions to persist into next year.”
Modest increases in home sales and house price growth are expected to drive purchase volume higher next year, according to the third-quarter report. While FreddieMac claims, “Year-to-date total home sales are the highest since 2007,” it does point out that “existing home sales are unlikely to increase much going forward. Limited inventory will remain a persistent problem, and longer term trends like the aging of the population and declining mobility across all age groups will keep a lid on existing home sales growth.”
FreddieMac predicts the growth in home sales will be primarily driven by new homes sales, particularly single-family construction.
Statistics compiled by the Economic & Housing Research Group reveal that “the mortgage market is shifting away from a refinance-dominated market to a more purchase-oriented market. That trend will likely continue in 2018.”