Economy

The Federal Housing Finance Agency is reducing the amount lenders can sell to a government-sponsored enterprise by $3 billion next year.

An inflation metric came in lower than expected, which caused the benchmark 10-year Treasury to drop well below the 4% mark.

The limit for high-cost areas for 2023, 50 percent above the baseline limit, would be approximately $1.08 million, writes a former principal economist with the Federal Housing Finance Agency.

Following the latest Federal Reserve boost in short-term rates, industry and other observers are anticipating more volatility to affect home loan financing.

A growing number of economists and lawmakers think the Fed has gone too far in its battle against inflation. Powell is worried it hasn't gone far enough.

But the static weekly data in the Freddie Mac survey does not accurately portray the volatility in the market in recent days.

In the first two quarters of the year, the channel's lenders lost an average of 35 basis points for each origination.

The industry is only about a third of the way to where it needs to be, an analyst from the Mortgage Bankers Association said at the trade group's conference Sunday.

The Mortgage Bankers Association and Housing Policy Council are asking for the Federal Housing Finance Agency to make government-sponsored enterprise data available as part of the establishment of its new Office of Technology.

However, the benchmark 10-year Treasury has been above 4% on a sustained basis for most of the prior week, gaining 18 bps, an indication of future increases for home loans.

The Federal Housing Finance Agency's tangible capital rule could prevent some banks from accessing advances from the Federal Home Loan Bank system in a rising interest rate environment.

The agency is currently using upper ceilings set in the Housing and Economic Recovery Act of 2008.

Four national housing market experts presented their economic and residential outlooks Thursday in a panel at the National Association of Real Estate Editors conference in Atlanta.

Consumer and business confidence is already under immense pressure from the rising cost of living, at the same time that equity, bond and real estate prices are falling.

Following the Consumer Price Index release, the 10-year Treasury yield broke through 4%, making continued increases likely.

Rising interest rates could force some community banks to fall below a critical capital threshold that the Federal Housing Finance Agency uses to determine eligibility for Home Loan bank advances.

And rising rates caused the government-sponsored enterprise to cut its forecast for this year.

Dozens of community bankers and housing experts offered their opinions on the Federal Home Loan Bank System, the first review in nearly 100 years. But the insurers, nonbanks and megabanks that use the system the most were largely absent from the debate.

Fannie Mae's sentiment index is at its lowest point since October 2011, as more consumers think prices will go down than those that expect them to rise.

But that was not enough to offset the fourth consecutive monthly decline in total nonbank industry jobs, according to the Bureau of Labor Statistics.