The current housing market is on fire and will have even more support with the $1.09 billion disbursements for Fannie Mae and Freddie Mac. The Federal Housing Finance Agency (FHFA) has never authorized such a large amount. In fact, this is double what was given last year.

The Federal Housing Finance Agency (FHFA) was established in 2008. The goal for the agency is to make sure that regulated institutions make good on their commitment. It is also there for a safe place for liquidity and funding for the housing finance market throughout the economic cycle.

Along with the agency, as part of the Housing and Economic Recovery Act (HERA) of 2008, congress created the Housing Trust Fund (HTF) and Capital Magnet Fund (CMF). Their purpose is to support affordable housing. HERA directed the Enterprises to set aside 4.2 basis points of each dollar of unpaid principal balance of its total new business purchases and then allocate those reserved funds following each fiscal year for. The funding is divided with the HTF receiving 65% and the CMF receiving 35%.For 2021 more than $700 million will be given to the U.S. Department of Housing and Urban Development (HUD) and the Department of the Treasury for the CMF will receive $383 million.

This is good news for the housing industry altogether. Now is a great time to purchase a home if you are in the market or thinking of buying a home.

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The end of 2020 was chaotic with the pandemic mixed with the holidays. This did not slow down the housing market, especially when it came to increases in home prices. It was reported that home prices rose at the fastest pace we have seen in seven years.

The S&P CoreLogic Case-Shiller Home Price Indices reported that nationally home prices rose 10.4% over the data collected in December 2019. Not only were the home prices rising at a record pace, but we saw the largest annual gains in the more than 30-year history of the index in December 2020.

“2020′s 10.4% gain marks the best performance of housing prices in a calendar year since 2013,” said Craig Lazzara, managing director and global head of index investment strategy at S&P Dow Jones Indices. “From the perspective of more than 30 years of S&P CoreLogic Case-Shiller data, December’s year-over-year change ranks within the top decile of all reports.”

The strongest gains were seen in Phoenix, Seattle and San Diego among the total cities surveyed. Phoenix showed a 14.4% increase year-over-year, Seattle had a 13.6% increase and San Diego was not far behind with a 13% increase.

COVID-19 has driven demand in homes because of the stay-at-home orders. People are more concerned with their homes now more than ever. A lack of inventory and the record low mortgage rates has made the current housing market very strong and desirable.

“These data are consistent with the view that Covid has encouraged potential buyers to move from urban apartments to suburban homes. This may indicate a secular shift in housing demand, or may simply represent an acceleration of moves that would have taken place over the next several years anyway,” Lazzara said.

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