Zweiacker & Associates

Freddie Mac Says 2011 Looks Good

Financial analysts at Freddie Mac have taken a stab at predicting some housing market predictions for 2011 . There are 5 main trends that they see in their crystal ball for this new year:

  1. Mortgage rates should stay low – Freddie Mac analysts predict that interest rates will remain below 5% for a fixed-rate 30-year note. Of course, there is no guarantee on this statement and the only way to be certain of your mortgage rate is to speak to a lender to see the exact rate for which you may qualify. Analysts do admit that mortgage rates will likely rise gradually throughout the year, making the beginning of 2011 the best time to purchase a home.
  2. Home prices have hit bottom – Analysts continue to predict that prices should begin a gradual increase throughout the second half of 2011.
  3. Affordable housing through 2011 – Since affordability still remains, predictions include a high number of first-time home buyers to help stimulate the housing market. The Daily Real Estate News even states that this implies “…more home sales in 2011 than in 2010”.  But remember, when we compare 2011 January-June sales to those same months last year, 2010 had the benefit of a Federal Tax Credit to help stimulate activity.  And that program is over.  So can we really “compare” 1st and 2nd Quarter of 2011 to 2010?  Maybe.  Maybe not.
  4. Refinances will decrease – The Federal Making Home Affordable refinance program expires on June 30, 2011 and many home owners have already refinanced.
  5. Delinquency rates will decline – According to the most recent business cycles, “seriously delinquent” rates generally crest within a year of the start of the recovery in payroll employment. Since payroll began to rise last January, these 90+ day delinquencies and foreclosures are predicted to dwindle.

All in all, this seems like an optimistic view of the housing market! Of course, even with the statistics to back it up, nothing is guaranteed. Luckily, the Bryan – College Station housing market is relatively healthy when compared to the rest of the U.S. Specifically, our local appreciation has been slow and steady, and did not suffer from the over-correction that caused housing values to suffer in rapidly appreciating areas of the country.  And if you would like specific data on how real estate in this part of Texas is doing, give a local Realtor® a call, for more information.


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