MONDAY, APRIL 25, 2016
- Employment: The labor market is expected to stay strong. The unemployment rate is projected to drop back below 5 percent for 2016 and 2017. “Stronger economic growth for the remainder of 2016 and reduced slack in the labor market will drive wage gains above inflation, though the gains are likely to be modest,” Freddie’s report notes.
- Mortgage originations: Loan originations are estimated to rise by $50 billion in 2016 and reach $1.7 billion. The forecasted boost is a result of low mortgage rates that are fueling a refinancing boom.
- Mortgage rates: Low mortgage rates are expected to stick around longer. The 30-year fixed-rate mortgage averaged 3.7 percent in the first quarter. “After lowering the forecast for subsequent quarters by a tenth of a percent, expect rates to average 4 percent in 2016,” Freddie Mac researchers note.
- Housing prices: Home prices will rise by 4.8 in 2016 and by another 3.5 percent in 2017, Freddie Mac researchers predict. These rising home prices will lead home owners’ to see more equity gains.