Fannie Mae

The potential impacts of import tariffs cloud the outlook, though, and could lead mortgage rates to surge and fall throughout the coming year.

Fannie Mae set aside $752 million for credit losses in its apartment complex lending business in part because of fraud or suspected fraud, denting profits amid an industrywide scrutiny of borrowers. 

The enterprise failed to improve on its net income but did report a steady profit, and got closer to meeting minimum risk-based regulatory capital requirements.

Spreads for Fannie Mae current coupon mortgage bonds, a proxy for securities being created now, jumped 0.07 percentage point to 1.41 percentage point, on track for the most widening in a day since April.

A Fannie Mae survey-high 86% of prospective buyers said it was a bad time to buy a home in May.

A financial services veteran, Peter Akwaboah joins the government-sponsored enterprise after serving as a managing director for Morgan Stanley, where he led technology and innovation strategy.

December's shift in Federal Reserve policy gave a notable boost to the share of consumer respondents who think the affordability of home financing will improve.

The mortgages are part of a program that received congressional scrutiny earlier this year.

An economic slowdown would deliver lower interest rates but tighter credit standards, while a "soft landing" for the economy wouldn't solve the low inventory problem, a new report said.

A vast majority of the pool, 86.35%, consists of primary homes. Investment properties and secondary homes, meanwhile, account for 11.29% and 2.36% of the collateral.

Researchers at the government-sponsored enterprise also maintained their outlook for a modest recession but moved anticipated onset to the fourth quarter this year.

Fee hikes at the government-sponsored enterprises are one remedy, the government-sponsored enterprise's regulator noted in its annual report to Congress.

Fannie Mae researchers found housing costs decelerating for the fourth straight quarter, but limited inventory may be driving hopeful buyers to look for opportunities in the new-construction market.

Scores will be assigned to all loan pools created since 2010, including future securitizations, and are expected to help investors determine the share of mortgages meeting specific characteristics.

On a combined basis, the GSEs performed better under this year's scenario than they did in 2021, but the Federal Housing Finance Agency said changes were still needed.

Its modifications aim to help two government-sponsored mortgage investors manage risk and rebuild capital while retaining enough flexibility to fulfill their affordable housing missions, said the Federal Housing Finance Agency’s acting director, Sandra Thompson.

"The quality of our new business is high. The pricing of that business does not reflect the capital requirements of our regulatory rule," CEO Hugh Frater said.

Compounding factors of low inventory and high costs also helped lead to another decline in Fannie Mae’s Home Purchase Sentiment Index.

However, the unusual profitability residential finance firms have previously enjoyed, and a strong housing market, could help to sustain their bottom lines.

Chryssa Halley, who has been with the company since 2006, was named CFO and Jim Holmberg was named controller.