Freddie Mac is on record stating that it doesn't think that interest rates will rise immensely on 2016, even though the Federal Market Committee's recent announcement that it is raising federal funds rate for the first time since 2006.
Freddie Mac's chief economist, Sean Becketti, said that interest rates should remain at historically low levels, in spite of whatever moves the Federal Reserve is expected to make.
Here are five more housing predictions for 2016:
1. Expect the 30-year fixed-rate mortgage to average below 4.5% for 2016 on an annualized basis.
2. Gradually higher mortgage interest rates will present an affordability challenge, but expect a strengthening labor market and pent-up demand to carry 2015's sales momentum into 2016.
3. Expect house price growth to moderate a bit to 4.4% in 2016, driven in part by the reduction in homebuyer affordability and reduced demand as a result of Fed tightening.
4. Housing activity will grow in 2016 despite monetary tightening. Expect total housing starts to increase 16% year over year and total home sales to increase 3%.
5. White home purchase will increase next year, higher interest rates will reduce the refinance volume pushing overall mortgage origination lower in 2016 than in 2015.
This would be good news for the housing market. If you are planning to sell be prepared with a current market value of your property.