As most everyone remembers, Fannie Mae and Freddie Mac were at the center of the most recent housing down turn; now Freddie Mac is reporting it has sustained a full year of profitability. Income was reported at $4.5 billion for Q4 2012 up 55 percent from the $2.9 billion ending Q3 2012. This level of profitability is attributed to efforts to minimize legacy losses and from the recent rebound in the housing market that I have been reporting for some time.
The lending community is an important partner in real estate; if consumers do not have access to capital there is no chance at a recovery. How the lending community and Wall Street continue to behave will be a vital component of the sustained recovery in the housing market. I am glad to see one of the mortgage giants is once again solvent.
On any given day Wall Street is bipolar at best; it is how the numbers play out over a few weeks or even months that will give you the true indication of the overall health of the economy. We won’t know the true effect of The Sequester cuts for some time. In the short term, I don’t see any major impact on housing. However, if a long term solution is not reached soon then all bets are off.
Another clear indication that the housing market is seeing a strong recovery locally is the 23 percent increase in sales dollar volume in Middlesex County over the past four months compared with the same time period last year.
With 303 more sales year-over-year in a four month period and $238 million more in sales volume, can there be any doubt that housing prices are on their way up?