MARKETING TO BORROWERS

While August's views on buying conditions and rates increased over July, the other components in Fannie Mae's sentiment index all declined, driving it lower.

Black homeownership fell to 43.9% this summer, its lowest since 2021, as rising unemployment and federal layoffs widened housing gaps across demographics.

The 30-year conforming fixed rate mortgage ended this week at its lowest since last Oct. 17, helped by bond traders pricing in a reduction in short-term rates.

The 30-year fixed rate mortgage fell 2 basis points this week, Freddie Mac said, but other sources like Zillow and Lender Price reported larger drops.

The bank "temporarily" paused home equity line of credit lending in April 2020, over concerns regarding the economic impact of the Covid-19 pandemic.

While still higher than the norm, the reduction in this spread is good news when it comes to mortgage rates for potential homebuyers as well as current owners.

Fannie Mae economists toned down their housing and economic outlook in August, predicting fewer home sales and less mortgage origination volume versus July.

The 30-year fixed rate mortgage fell by 5 basis points, with the Consumer Price Index showing muted inflation and jobs data still influencing the market.

As high interest rates make refinancing impossible for many homeowners, increasing numbers of them are turning to HELOCs and home equity loans for cash.

Fannie Mae also foresees more home sales than it did in June, but the Mortgage Bankers Association reduced its origination projections for 2025.

Housing supply is returning to pre-pandemic levels, but the rise comes as new listings fall, pointing to subdued demand, leading real estate brokerages said.

The 30-year fixed mortgage rate rose for the first time in six weeks, driven by Friday's strong jobs report and renewed uncertainty around tariffs.

The gap between costs and wages hit an inflection point and policy may determine what happens next, according to the Harvard Joint Center for Housing Studies.

While lenders have come out with more products for the spring season, rate lock data finds buyers still hesitant to act because of high mortgage rates.

Even with the four basis-point drop, the 30-year fixed rate mortgage remained at levels last seen in February as the Spring homebuying season reaches its climax.

However, with the market continuing to shift more in favor of homebuyers, home prices should move lower, aiding affordability in the weeks ahead.

Increases in gross domestic product and home sales expectations compared with April are the drivers of Fannie Mae's latest mortgage outlook for 2025 and 2026.

Pricing on the 30-year fixed rate mortgage retreated this week as investors digested some economic news, including a GDP contraction in the first quarter.

The 30-year fixed rate mortgage average rose 21 basis points this week, lagging other indicators, which are all now lower than seven days ago.

If mortgage rates drop into the low 6% range, there will be a retention opportunity on 5.4 million loans that have interest rates starting at 6.5%.