Author: Anders Klintoe
The report seeks to highlight the major economic mortgage drivers along with CRT Performance and an origination quality index both derived from Freddie Mac’s ACIS® & STACR® Programs.
The latest quarterly economic indicators reveal a robust performance in key areas. Gross domestic product (GDP) has shown continued strength, expanding by 1.2% in the quarter and 4.9% on an annual basis (see "Gross Domestic Product" in the executive summary). The unemployment rate remains low at 3.7% (see "Unemployment Rate"). Personal income per capita has steadily risen, reaching an all-time high of $68.7K per household (see "Personal Income per Capita").
The labor force participation continues to slowly expand and is now in line with the participation rate observed during 2015-2018 (see "Labor Force Participation Rate"). The Consumer Price Index (CPI) surprised on the downside during the fourth quarter leading to expectations of rate cuts in 2024.
The change in expectations for rates in 2024 resulted in a rapid decline in mortgage rates from a peak of 7.8% in October to 6.6% by the end of December (see "Mortgage Rate Developments"). The Federal Housing Finance Agency (FHFA) announced that the conforming loan limit for 2024 will be $766,550, up $40,350 from 2023.
To request the full report, please reach out to a member of the mortgage team.
