Freddie Mac profits jump to $2.9B in Q2 2023

Freddie Mac generated $2.94 billion in net income in the second quarter, up 41% from the first quarter and 20% year-over-year. Like its larger government sponsored enterprise cousin Fannie Mae, Freddie Mac’s second quarter was boosted by rising home prices.

Executives on Wednesday said home prices rose 2.4% through the second quarter and are forecast to inch up another 0.8% by year’s end. As such, Freddie freed up $537 million it had in loss reserves, contributing to its larger profit over the prior quarter.

“The second quarter saw single-family home prices stabilize, influenced by strong demand, higher residential mortgage rates, and limited homes for sale,” Freddie CEO Michael DeVito said in a statement. “Renters continue to be cost burdened as rents rose in the face of softening multifamily property prices. Freddie Mac remained focused on its mission and delivered a solid quarter, helping 372,000 buy, refinance, or rent a home, the majority of them affordable to low- or moderate-income borrowers and renters.”

Purchase loans represented 89% of Freddie’s business in the second quarter; just 11% came from refinancings.

Here are some additional highlights from the second quarter call: