Freddie Mac: Low rates could lead to flurry of housing activity
Posted on Wednesday, January 21, 2015 at 8:04:54 AM
The housing market has been on the upswing lately, thanks in part to low residential financing rates and a stronger U.S. economy.
That momentum is expected to continue in 2015, according to Freddie Mac's U.S. Economic and Housing Market Outlook. The government-sponsored enterprise reported that mortgage rates should stay around 4 percent for at least the first two quarters, while there is a good chance that home price appreciation continues in January.
"On balance there are a lot of positive opportunities in the U.S. economy at the start of the year, and the real question is whether or not households and businesses will be able to seize these opportunities and make the most of them," explained Frank Nothaft, vice president and chief economist at Freddie Mac. "The reprieve in interest rates and drop in gas prices should help to spur economic growth."
In addition to Freddie Mac's optimism about the housing market, many economists and homebuilders expressed a similar sentiment at the recent International Builders Show. Attendees noted that job growth and consumer confidence will help the housing market continue its recovery, The Wall Street Journal reported.
David Crowe, chief economist of the National Association of Home Builders, pointed to the improved U.S economy as a key reason why the housing market should improve in 2015.