Existing home sales drop to lowest pace since 2009

Plus: Fannie Mae and Freddie Mac surge on Trump post

May 23, 2025

🏖️ Memorial Day weekend is upon us! We're off Monday for the holiday and back in your inboxes Wednesday! Today’s newsletter is 750 words, a 2.5-minute read.

Disclaimer: Average mortgage rates as of May 22, 2025. © MND Daily Rate Index.

1. Fannie Mae and Freddie Mac surge on Trump post

Trump’s announcement that he’s considering a public offering of the companies sent Fannie Mae’s stock up 50% and Freddie Mac’s stock up 42% on Wednesday.

Change in Fannie Mae and Freddie Mac share price: Daily; May 21, 2024, to May 22, 2025

The administration officials have now been tasked with devising a plan to end the agencies' conservatorship without destabilizing the housing market or driving up mortgage rates.

And in order for that to happen, some sort of government guarantee will likely have to remain in place, probably in the form of Senior Preferred Stock Purchase Agreements, under which the government promises to inject cash into the companies should they ever need the money.

2. Existing home sales drop to lowest pace since 2009

The spring housing market continues to struggle amid high interest rates and low consumer confidence.

Sales of previously owned homes in April declined 0.5% from March to a seasonally adjusted, annualized rate of 4 million units, according to the NAR. That is the slowest April pace since 2009. Sales were down 2% from April of last year.

This count is based on closings, meaning contracts that were likely signed in February and March, before mortgage rates moved even higher in April.

“Home sales have been at 75% of normal or pre-pandemic activity for the past three years, even with seven million jobs added to the economy,” said Lawrence Yun, NAR’s chief economist, in a release. “Pent-up housing demand continues to grow, though not realized. Any meaningful decline in mortgage rates will help release this demand.”

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3. More Nuggets

🚥 Home sales cancelled at near-record pace in April. (Redfin)

📝 House passes tax reform package with key wins for real estate. (NAR)

🔊 Appraisal Institute fires executive accused of sexual misconduct. (LinkedIn)

🤝 The ‘joiner’ era of bank M&A has begun. (BankingDive)

📉 ION: Buying the dip might be a guy thing, BlackRock study finds. (Axios)

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4. Lower rates could bring more home sales: Fannie Mae

Fannie Mae has revised its housing outlook upward, citing easing mortgage rates and improved affordability.

The GSE now forecasts 4.92 million home sales in 2025 — up 60,000 from April’s estimate — and 5.25 million in 2026, with mortgage rates projected to fall to 6.1% this year and 5.8% next.

Mortgage originations are expected to rise to $1.99T in 2025 and $2.38T in 2026. Home price growth is seen slowing, with a 4.1% increase this year and just 2.0% in 2026, pointing to a cooling but stabilizing market.

Fannie Mae’s outlook comes amid renewed speculation over the GSE’s long-term future, with President Donald Trump signaling potential interest in re-privatizing Fannie and Freddie Mac.

5. FHFA’s Pulte targets FICO over rising credit report costs

FHFA Director Bill Pulte is ramping up scrutiny of FICO, criticizing rising credit report prices and signaling upcoming changes to GSE credit-score models.

In social media posts, Pulte questioned why report costs have doubled and expressed frustration with FICO’s pricing, prompting a 25% drop in the company's stock.

He confirmed FHFA will move forward with shifting from tri-merge to bi-merge credit reports for Fannie Mae and Freddie Mac loans and will adopt FICO 10T and VantageScore 4.0.

The changes, aimed at reducing costs and increasing competition, are slated to begin in Q4 2025 after prior delays. Industry estimates show credit reporting costs in 2025 are up at least 20% from last year.

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☀️ You’re all caught up. See you on Wednesday!

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