Freddie Mac forecast: What experts are saying about Albuquerque’s Real Estate Market
(Transcript Snippet): “Tego:
What about the forecast? What are the experts saying?
Tracy:
Well, as the market recovers from COVID. The housing market is going to stay healthy and slowly mortgage rates will move up. I don’t expect to see anything very quick on that. Right. but that’s, that’s the forecast from Freddie Mac. So Freddie Mac, I’m not, I’m not I don’t have as big a team of researchers behind me. I’m quoting Freddie Mac. Well, of course, while you’ve got me, I know you’re my number one researcher, and I’m every morning over coffee. I appreciate hearing about it.
Tego:
So Freddie Mac does a quarterly forecast where they look into Freddie Mac, you know, as one of the the, the big government sponsored mortgage funds basically. And they always look and like, kind of give a forecast what’s going on and what they’re saying for, you know, right now we’re somewhere around 3.1, 3.2% interest rates that, you know, it fluctuates obviously, but they’re saying through 2021, it’s going to stay pretty close to here in the low mid to low, to mid, to low threes. They’re even saying for 2022, they’re saying 3.7. So still not even getting to that, that 4% even next year. Interesting. the number of home sales they’re predicting to be above last year, last year was a record year, 6.5 million nationally. This year, they’re saying 7.1 in 2022, they’re saying 6.7 million homes sold. So again, they, they are expecting a healthy growing residential real estate market.
Tracy:
Let’s talk about the number that I hear the most that people seem to really want to know about when people are saying, I can’t buy a house prices are too high. Well, Freddie Mac says, prices are going to keep going up for the next two years. Yeah.
Tego:
And not just Freddie Mac. I’ve seen that on all the air quote experts are saying the same thing, right?
Tracy:
So they’re saying home prices in 2021 across the States are expected to average 6.6% up. And we’re definitely seeing that in our market and many others that we watch.
Tego:
We’re going to be ahead of that this year. I mean, I’ll, I’m going to say this right now in April of 2021, that we are going to see probably double I’m going to I’m not going to say probably we’re going to see double digit home price growth for 2021. I just, there’s no writing on the wall that says that home prices aren’t going to keep going up. Unless we get that, you know, the so-called black Swan,
Tracy:
And they’re saying, they’re going to keep going up in 2022. Now this is really early. It’s April, 2021, where they’re forecasting next year’s home price appreciation. And they’re saying four and a half percent appreciation, 20, 22 nationally. That’s nationally. Yeah. They’re not saying things are going to pull back. And everyone that bought a house today is going to be wishing they hadn’t,
Tego:
I, I don’t want to go into the detail, but I’ve seen some great charts on, you know, what markets in the country are down in. There are actually markets where prices are down. Think of places like New Jersey, New York, certain parts of California that just got really overheated on prices. But, but for the most part, it’s, it’s East and Midwest markets, not the South and the Southwest where we are, everybody in the South and the Southwest is, is booming one way or another
Tracy:
It’s it’s not, then it’s not very many communities. When you say there are some that are down. It’s a very few, it’s basically like a handful. Yeah.
Tego:
And it’s, it’s the really high price markets where that’s really bad.
Tracy:
And here our high price market is booming. Yeah. Right? Yeah.
Tego:
Yeah. like, I think it was an 80% increase in the number of homes sold over a million dollars in the last year.
Tracy:
I think it was higher than that, but that was a few shows ago now.
Tego:
Yeah. I know. I haven’t looked at it. I actually have it on our website. I just don’t have it up here now. Speaking of, of Freddie Mac there was a news release that came out this week that I thought was actually really good. Well, there’s a couple of news releases. One of them Tracy was that, that the the Biden administration and some lawmakers have put some bill forward to offer a $15,000 tax credit for first-time home buyers.
Tracy:
Oh, I hadn’t heard that. Unlike the 8,000 back in like 2008,
Tego:
2000, was it 2008 or 2008? Yeah. I mean, that was to help stimulate the housing market
Tracy:
Because buyers in the market.
Tego:
Right. Let’s just be honest here. We don’t need more buyers in the market right now. What we need are more homes in the model.
Tracy:
Right. It should be giving credits to the home builders to get those houses built, to offset the increases.
Tego:
Amen to that. And I know all the builders out there that listen are saying amen to that too, because you know, people are going well, how come there’s no new construction under $300,000 in Albuquerque? I mean, there, there is in a few places very limited. And you know, you think about this, a builder is paying a hundred thousand dollars before they do anything on that piece of land,
Tracy:
Just for the land and the permits and the yup. Yeah.
Tego:
And then the engineering and, you know, everything, you know,
Tracy:
Pretty hard to build a house on top of that and still be in that very affordable range.
Tego:
Yeah. So anyway, it’s interesting that, that this is that they’re doing it, that they’re offering a $15 Valor credit right now. It’s just a bill.
Tracy:
I was gonna say, we’ll see what happens. We’ll see if it happens. If it materializes
Tego:
The spills. And I know listeners to the Kiva probably pay attention to politics a lot. And they know there’s a lot of bills floating around, out there in the house. So
Tracy:
It happens. Yeah. 15,000, you got to, you know, our listeners need to talk to everybody. They know that should be buying a house. Right. I mean, we, we have to get all those 20 somethings into their first house. I closed one this week, Tigo. Yep. 24 years old first house. It was so satisfying. He was so cute and so, so excited. And he was like, yes, ma’am with all the closing documents, when the title officer would say, and this one’s about, and he’d go, yes. Ma’am.
Tego:
Yes. Ma’am that means you’re really old, right?
Tracy:
Yeah. Well, he wasn’t calling me that, but I wasn’t really in charge at the closing, but just such a great kid getting his first house. I mean, young man, it was, it was really fun.
Tego:
You can call him kid, you know, I don’t know what age can you start calling?
Tracy:
I mean, he’s 24. I need to call him a young man. Yes, yes. With, as a homeowner, there you go.
Tego:
Okay. Can I get back to this story now? No, that was a good story. It’s it’s exciting. That really is a satisfying part of what we do for sure. The other big story this week, other than the tax credit was FHFA, which is kind of the entity that’s over Fannie and Freddie,
Tracy:
Federal House Finance Agency.
Tego:
They are putting together some programs to help. What do they call it? Low income homeowners that have mortgages refinance because what’s happened. And we’ve heard a lot of this over the over COVID right. That, you know, it’s decay economy, the richer getting richer, the poor are getting poor. Some people are participating in recovery. A lot of people aren’t participating in the, in the recovery after COVID. Well, what they’re doing is they want to help people that maybe have not been able to take advantage of the low mortgage rates, do a refi
Tracy:
Because maybe their financial picture, they wouldn’t qualify for the home right now because of unemployment or,
Tego:
Yeah. So what they’re doing is they’re doing a program that’ll help boost those people. You know, as long as they’re, you know, saving like $50 a month, there’s some qualifications, they have to have a decent credit score. I think it was six 20 or something like that, Tracy. But anyway, it’s, it’s good to see that they’re doing that because not only does that help that person, it actually helps stimulate the economy. Cause now if that person saving a hundred, 200, 300, $400 a month on their mortgage payment, well, that’s money that now can go back into the overall economy. So I’m glad to see that that FHA and Fannie and Freddie are doing that
Tracy:
Program has been released. That’s not a pending that one exists. Now. It says, basically you have to save at least $50 a month in your mortgage payment, by refinancing to qualify along with a few other things, you said $50 a month. And I said to clarify, that’s how much you have to at least reduce your monthly payment by to qualify.
Tego:
That’s what happens when I read these stories a couple of days ago and then try to recite them back to memory. So you actually read the story. So thank you. Thank you. Read a little bit. Yeah. And they’re going to be credit for appraisal if you qualify stuff like that as well. Right. As well. So yeah, it’s a, it’s a good program. I’m I’m really, really glad to see it.