
The GSE warns of potential for weaker credit performance as economic, home price gains slow.
Fannie Mae showed a strong 22% year-over-year increase in net worth according to an earnings report released Friday. The company claims a net worth of $94.7 billion as of the end of last year, up from $77.7 billion at the end of 2023.
The government-sponsored enterprise (GSE) reported $17 billion in net income for 2024 and $4.1 billion for the fourth quarter. Net income was up about 2.5% from $4 billion the third quarter of 2024 and up about 5% from $3.9 billion a year prior.
“Our strong results were driven by guaranty fee income, consistent with the transformation of our business model that began well over a decade ago,” Priscilla Almodovar, Fannie Mae’s president and CEO, stated in a release. “For the year, we provided $381 billion in liquidity to the U.S. housing market, helping 1.4 million households buy, refinance, or rent a home.”
Of that $381 billion, the vast majority was in single-family home purchases – which actually shrunk in total volume while refinances saw a significant increase.
Single-family purchase acquisition volume decreased about 1% to $269.9 billion in 2024 from $272.8 billion in 2023, while refinance acquisition volume was $56.1 billion in 2024, an increase of nearly 30% from $43.2 billion in 2023.
Total single-family conventional acquisition volume last year was $326 billion for Fannie Mae, up from $316 billion in 2023. The company acquired approximately 778,000 single-family purchase loans, of which about half were for first-time homebuyers, and just over 200,000 single-family refinance loans during 2024.
The GSE’s single-family conventional guaranty book had a weighted-average mark-to-market loan-to-value ratio of 50% and a weighted-average FICO credit score at origination of 753.
The single-family serious delinquency rate – loans that are 90 days or more past due or in the foreclosure process – increased to 0.56% as of the end of 2024 from 0.48% in Q2 2024 and 0.55% at the end of 2023. But those are national averages; some states, including Louisiana, New York, Mississippi, and Florida as well as the territory of Puerto Rico, had serious delinquency rates of 0.76% or higher as of the end of Q4 2024, the company reported.
The latest uptick in single-family serious delinquency rates was driven by increased delinquencies in areas affected by hurricanes, Fannie Mae noted in a filing with the Securities and Exchange Commission – and there's a chance things could worsen going forward.
"Given our expectation of slower economic and home price growth in 2025 and 2026, the credit performance of the loans in our single-family guaranty book of business may decline compared to recent performance, which could lead to higher delinquencies or an increase in our single-family serious delinquency rate," the company stated.
According to the Fannie Mae Home Price Index, U.S. home prices grew 5.8% on a national basis in 2024. That follows increases of 5.5% in 2023, 7.8% in 2022, 18.3% in 2021, and 10.2% in 2020.