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The Institutional Risk Analyst

© 2003-2025 | Whalen Global Advisors LLC  All Rights Reserved in All Media |  ISSN 2692-1812 

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Residential Mortgage Finance 2025

Writer's picture: R. Christopher WhalenR. Christopher Whalen

Updated: Jan 21

January 21, 2025 | Premium Service | Over the past year and more, the sharp upward moves in the market value of the Fannie Mae and Freddie Mac, those high-flying penny stocks, have distracted some observers from the changes underway in the land of mortgage finance. With the nomination of Bill Pulte to lead the Federal Housing Finance Agency, however, maybe the GSE trade is done. Below for readers of our Premium Service, we dig into the mortgage finance complex as a year of 7% plus residential mortgages looms ahead.



The first, big picture question to ask is about the outlook for new production of 1-4 family loans and mortgage-backed securities (MBS). The answer is that average production in the industry was running below $1.5 trillion in 2023 and at $1.7 trillion in 2024. Estimates for production in 2025 were above $2 trillion based upon the assumption of interest rate cuts that are no longer anticipated. We expect the actual production in 2025 to be below $2 trillion. 


Source: Mortgage Bankers Association


Profitability in the industry is likewise improving from the lows of 2023, but only just barely.  Not quite three quarters of all IMBs were profitable in the first 9 months of 2024 (h/t Joe Garrett), according to the Mortgage Bankers Association. But being barely profitable is a long way from financial stability and soundness.

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© 2003-2025 | Whalen Global Advisors LLC  All Rights Reserved in All Media | ISSN 2692-1812

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