Federal Nat Stock Price, News & Analysis

The Fannie Mae Home Purchase Sentiment Index® (HPSI) increased by 3.2 points in June to 72.6, marking a rebound from the previous month's dip and nearing an earlier plateau. Consumer optimism regarding homebuying conditions rose, with 19% considering it a good time to buy, up from 14% in May. The sentiment that it's a good time to sell also increased to 66%. Job security perceptions improved, with 79% feeling secure. However, affordability concerns persist, with expectations for rising home prices and mortgage rates. Year-over-year, the HPSI saw a 6.6-point increase.

Fannie Mae (OTCQB: FNMA) has announced its fifth Credit Insurance Risk Transfer (CIRT) transaction of 2024, transferring $337.2 million of mortgage credit risk to private insurers and reinsurers.

The transaction, CIRT 2024-L3, covers roughly 24,000 single-family loans with an unpaid principal balance (UPB) of $8.2 billion. These loans were acquired between July and September 2023 and span fixed-rate, 30-year terms with loan-to-value (LTV) ratios between 60.01% and 80.00%. The deal, effective May 1, 2024, retains 170 basis points of loss with Fannie Mae, while the remaining risk is transferred to insurers.

Since the inception of the CIRT program, Fannie Mae has secured $27.6 billion in insurance coverage on $921.6 billion of loans. As of March 30, 2024, $1.33 trillion in UPB of single-family conventional loans were included in a credit risk transfer transaction. Fannie Mae provides comprehensive disclosure data and analytics tools to support market participants in evaluating CIRT deals.

Fannie Mae (OTCQB: FNMA) has released its 2023 Corporate Responsibility and Impact (CRI) Report, previously known as the Environmental, Social, and Governance Report. This annual publication highlights Fannie Mae's efforts to support the U.S. housing finance system and its mission to provide equitable and sustainable access to affordable housing. The 2023 CRI Report emphasizes transparency and covers environmental, social, and governance priorities. It also addresses stakeholder engagement and evolving housing finance system assessments, including topics relevant to ESG investors and reporting standards. The full report is available on Fannie Mae's website.

Fannie Mae (OTCQB: FNMA) released its May 2024 Monthly Summary on June 27, 2024. The report details the company's monthly and year-to-date activities, focusing on its gross mortgage portfolio, mortgage-backed securities, and other guarantees. It also includes data on interest rate risk measures and serious delinquency rates, providing a comprehensive overview of Fannie Mae's financial health and operational performance during this period.

The Fannie Mae Economic and Strategic Research (ESR) Group reports continued affordability constraints in the housing market, leading to a downgrade in the 2024 home sales forecast to 4.82 million, a 1.3% annual gain, lower than the previous 2.8% projection. Despite an increase in home listings, sales remain weaker than expected due to the 'lock-in effect' and recalibrated mortgage rate expectations. The ESR Group also downgraded the 2024 GDP growth outlook to 1.6% due to revisions in Q1 GDP data and slowing income and spending growth. The Federal Reserve is now expected to cut rates only once, in December, given the need for sustained cooling inflation. The unemployment rate has risen to 4%, indicating a gradual labor market slowdown. The ESR Group believes housing market activity will remain subdued without significant improvements in income growth, home price appreciation, or mortgage rate declines.

Fannie Mae (FNMA) has completed its fourth Credit Insurance Risk Transfer (CIRT) transaction of 2024, known as CIRT 2024-H2, transferring $284.8 million of mortgage credit risk to private insurers and reinsurers. The covered loan pool includes approximately 34,000 single-family mortgage loans with an unpaid principal balance (UPB) of $12.1 billion, featuring loan-to-value (LTV) ratios between 80.01% and 97%. These loans were acquired between May and September 2023 and are fixed-rate, 30-year term, fully amortizing mortgages underwritten with stringent credit standards.

The transaction, effective April 1, 2024, retains risk for the first 185 basis points of loss on the $12.1 billion loan pool. If this retention layer is exhausted, 25 insurers and reinsurers will cover the next 235 basis points of loss, up to $284.8 million. Coverage lasts for 18 years, with potential reductions based on loan paydowns and delinquencies. Fannie Mae may cancel coverage after five years by paying a fee. To date, Fannie Mae has acquired $27.2 billion in insurance coverage on $913.4 billion of single-family loans through the CIRT program.

The Fannie Mae Home Purchase Sentiment Index® (HPSI) dropped 2.5 points in May, reaching 69.4. This decline marks a new survey low for consumer attitudes toward homebuying conditions, with only 14% of respondents deeming it a good time to buy a home, down from 20% last month. Similarly, those believing it's a good time to sell fell from 67% to 64%. Despite this, household income perceptions improved, with 20% of respondents reporting higher incomes than a year ago. Consumer sentiment reflects frustration over unaffordability, with expectations that home prices and mortgage rates will rise in the near future. The HPSI is up 3.8 points year over year.

Fannie Mae (OTCQB: FNMA) announced surpassing $3 billion in single-family labeled social bond issuances. This is facilitated by the new Social Indicator, which helps investors identify mortgage-backed securities (MBS) issued since March 1, 2024, under Fannie Mae's Single-Family Social Bond Framework.

The platform enhancements, including PoolTalk® and Data Dynamics®, enable investors to track over $3.6 billion in issued social bonds and future issuances. Monthly issuances of over $600 million in Social MBS attract investors both with and without a social objective.

These bonds support populations facing barriers to affordable housing and credit access, aligning with global standards and validated by a Second Party Opinion. Annual impact reports will also be provided to detail the social impacts of these investments.

The Q2 2024 Fannie Mae Home Price Expectations Survey (HPES) forecasts a slowdown in home price growth for 2024 and 2025, with expected increases of 4.3% and 3.2%, respectively, compared to 6.6% in 2023.

The survey, produced in partnership with Pulsenomics, , gathers insights from over 100 housing and mortgage experts.

Notably, the anticipated 30-year fixed mortgage rate for 2024 is projected to be 6.6%, up from a prior estimate of 5.9%.

Despite higher mortgage rates, for-sale home listings are trending upward, with 84% of respondents attributing this to a diminishing 'lock-in effect.'

However, ongoing affordability challenges could slow the conversion of listings to actual sales.

Experts see a potential easing in the housing affordability crisis but note that significant price surges since 2020 pose challenges for prospective homeowners.