Skip to Page Content | Skip to Site Navigation | Skip to Section Navigation

Posts by Frank E. Nothaft

Chief Economist Frank E. Nothaft

Frank E. Nothaft is Freddie Mac’s chief economist. Nothaft is responsible for forecasts, research and analysis of the macroeconomy, housing and mortgage markets. He is also involved in affordable lending analysis and policy issues affecting the housing finance industry.

Full Bio 

Pick Up in Economy During Second Half

The economy hit a soft patch during the spring, buffeted by rising energy costs and heightened economic uncertainty. Economic growth should pickup in the second half of the year, supported by accommodative monetary policy, restoring stronger monthly job gains and bringing the unemployment rate down toward 8.6% by the fourth quarter.

Homebuyer affordability remains very high, driven by the twin forces of low financing costs and a buyer's market. Mortgage interest rates have gradually moved lower for most of the spring, with fixed-rate loans just slightly above the half-century nadir attained last fall and likely to remain in a 4.5% to 5.0% range for 30-year product over the balance of the year. Likewise, U.S. house price indexes moved lower during the first quarter, helping set the stage for a high-degree of purchasing power for home seekers.

Read More

Mortgage Borrowers Who Refinance Are Lowering Debt

Recent data show that consumers generally are shedding debt – and lowering or paying down their mortgages is just another way they’re doing it. Between 2007 and the fourth quarter of 2010, mortgage debt declined more than $400 billion, according to the Federal Reserve Board.

With mortgage rates in the four percent range (the likes of which haven’t been seen in more than 50 years), many borrowers have refinanced their mortgages.

Read More

The Boom, the Bubble, and the Bust Abroad

The housing crisis this country has experienced over the past four years has been the worst since the Great Depression. That comes as no surprise to most Americans; as home prices fell, the country saw a vigorous debate about the crisis, and about the laws and regulations that have emerged to help prevent another one from happening.

What is surprising is how often the debate here characterizes boom-bust cycles in housing prices as though they are uniquely American. They aren't.

Read More

Peering into 2011: Five Features of Next Year's Housing and Mortgage Markets

As in the past, key macroeconomic drivers of the economy – such as income growth, unemployment rate, and inflation – will affect the performance of the housing and mortgage markets in 2011. With fiscal policy supporting aggregate demand for goods and services and an accommodative monetary policy providing low interest rates and ample liquidity to capital markets, the economic recovery should accelerate gradually over the year, with the second half of 2011 exhibiting more growth and job creation than the early part of the year.

With that as the macroeconomic backdrop, these forces will support a gradual recovery in the housing and mortgage markets. Here are five features that will likely characterize the 2011 housing and mortgage markets.

Read More

Housing America's Families

The U.S. is in the early stage of an economic expansion that began at the end of 2009 or the start of this year. As is sometimes the case in the initial phase of a recovery, there are mixed messages from economic indicators on the overall health of the macroeconomy and of the housing market. GDP growth surged late last year, but slowed in the second quarter. Similarly, job market growth turned positive last winter but appears to have lost momentum. The choppy pattern of economic recovery is not unusual and will likely continue throughout this year, with clearer signs of expansion eluding us before next year.

Still, there are a number of positives in the housing market. For one, declines in home sales, construction, and house prices have slowed or stopped – and have even rebounded in some metropolitan markets. This recovery has been supported, in part, by the low interest rate policy of the Federal Reserve and the active involvement of Freddie Mac, Fannie Mae and Ginnie Mae to assure that an adequate supply of funds is available to meet the mortgage credit needs of America's families. Mortgage rates on loans ineligible for pooling into their securities, such as "jumbo" loans, carry fixed-rates that are nearly a full percentage point above the rates on "conforming" loans.

Read More

Older Newer


Our Executive Perspectives feature insights from company leaders on key trends in housing finance and how Freddie Mac is supporting the nation's housing recovery.

Subscribe to Executive Perspectives

Check Out Our New Blog on Housing

Back to Top