Freddie, Fannie Report Solid First-quarter Financial Results
Written By: Joel Palmer, Op-Ed Writer
The mortgage industries two government sponsored enterprises opened 2024 with new solid first-quarter financial results.
Fannie Mae and Freddie Mac reported their first-quarter earnings last week. Both continue to grow their revenues and profits in a market challenged by housing affordability issues.
Fannie Mae booked $4.3 billion in net income on $7.1 billion net revenue during the first three months. Net income was 10 percent higher than in the previous quarter and 15 percent more than in the first quarter of 2023. This boosted the company’s overall net worth to $82 billion.
“Fannie Mae reported strong results in the first quarter, delivering $4.3 billion in net income, marking our 25th consecutive quarter of positive earnings,” said Fannie Mae CEO Priscilla Almodovar. "The strength of the U.S. economy, higher single-family home prices, and the credit quality of our book of business continue to be important factors affecting our performance.”
Freddie Mac reported $2.8 billion in net income for the quarter on $5.8 billion in revenue, which grew its net worth to $50 billion. While its net income was down slightly from the previous quarter, it was 39 percent higher than what it generated in the first quarter of 2023.
“Freddie Mac had a solid first quarter, as the company continued to serve low- and moderate- income families despite persisting affordability challenges in the housing market,” said Michael T. Hutchins, Freddie Mac’s President and Interim CEO.
Fannie acquire roughly 155,000 single-purchase loans during the quarter, of which 45 percent were for first-time homebuyers. The company provided $72 billion in liquidity, enabling 280,000 home purchases, refinancing, and rental units.
In the single-family housing market, Fannie acquired $62.3 billion in volume, down slightly from the fourth quarter of 2023, though refinance business grew slightly from $8.4 billion to $9.3 billion. Similar to its overall earnings, the single-family market business grew 9 percent over a quarter-to-quarter basis and 15 percent on a year-over-year basis.
Fannie’s multifamily volume also declined from quarter to quarter, from $11.2 billion to $10.1 billion. The company financed 89,000 units during the quarter, with a significant majority benefitting households earning at or below 120 percent of area median income. Net income for the sector was $713 million, up 12 percent from the previous quarter and 11 percent from the previous year.
Whereas Fannie saw most of its growth in single-family, the bulk of Freddie’s growth in the quarter was in the multifamily market.
For the quarter, Freddie generated $821 million in net income in multifamily. That marked a sizable increase of 220 percent on a quarter-to-quarter basis and 158 percent on a year-over-year basis. Freddie said 90 percent of its $9 billion of first-quarter multifamily activity benefitted households earning at or below 120 percent of area median income.
Freddie’s single-family new business activity was $62 billion in the first quarter, up from $59 billion in the first quarter of the previous year. Freddie generated $1.9 billion in net income from the segment in the quarter, down from $2.7 billion in the previous quarter and up slightly from $1.7 billion from the first quarter of 2023. Freddie said 54 percent of its single-family business in the quarter benefitted low- and moderate-income households, and 52 percent helped first-time homebuyers.
