/EINPresswire.com/ -- MCLEAN, VA--(Marketwired - Aug 17, 2017) - Freddie Mac (OTCQB: FMCC) today released its monthly Outlook for August, which takes a look at how the limited supply of houses has created a highly competitive housing market, which in turn is helping to keep the share of cash sales significantly above its historical norm and dampening mortgage originations.

Outlook Highlights

• Housing starts were lower than anticipated during the second quarter of this year. While starts should improve in the second half of 2017, expect them to remain well below their long run average at around 1.24 million.
• With mortgage rates expected to stay below 4 percent for the remainder of the year, home sales should reach 6.2 million units for 2017, a three percent increase over the 2016 pace. However, home sales would be much higher if inventory was not so tight.
• Thanks to the high demand and low inventory, expect house price appreciation to average 6.3 percent for full year 2017.
• In June, cash sales accounted for around 18 percent of all home sales, below the peak of 35 percent, but still well above the historical average of 10 percent.
• If cash sales remain around 20 percent, that would translate to $172 billion less in mortgage originations than would occur if the cash share returned to its historical norm.

Quote: Attributed to Sean Becketti, Chief Economist, Freddie Mac.

"Usually, not many people like to invest a lot of cash into real estate, which is illiquid and has high transaction costs. However, in the current, highly-competitive housing market, a cash offer is an effective way to gain an advantage over other bidders. In a cash sale, the seller doesn't have to worry about the buyer's ability to obtain a mortgage or the chances that an appraisal will come in below the agreed sales price. And each cash sale means one less mortgage origination."

Freddie Mac makes home possible for millions of families and individuals by providing mortgage capital to lenders. Since our creation by Congress in 1970, we've made housing more accessible and affordable for homebuyers and renters in communities nationwide. We are building a better housing finance system for homebuyers, renters, lenders and taxpayers. Learn more at FreddieMac.com, Twitter @FreddieMac and Freddie Mac's blog FreddieMac.com/blog.