Overview
- FHFA Director Bill Pulte said Fannie Mae and Freddie Mac will execute the purchases and can do so very quickly.
- Mortgage-backed securities rallied and lender stocks including Rocket and LoanDepot jumped after the announcement, while the 10-year Treasury yield edged lower.
- Economists estimate the move could trim roughly 0.25 to 0.5 percentage points from 30-year mortgage rates, though the ultimate effect remains uncertain.
- Analysts warn that drawing on GSE cash buffers could revive 2008-era concerns and that limited housing supply could translate lower rates into faster home-price gains.
- The plan builds on GSEs’ recent portfolio expansion and follows a proposal to curb institutional single-family home purchases, with more housing measures expected in a Davos speech.