Fannie Mae’s mortgage acquisition volume rose in 2024, but profits shrank slightly

On Friday, Fannie Mae reported $17 billion in net income in 2024, down slightly from its $17.4 billion profit in 2023. The government-sponsored enterprise (GSE) had net income of $4.1 billion in the fourth quarter of 2024, marking its 28th consecutive quarter of positive earnings.

Fannie Mae president and CEO Priscilla Almodovar said during Friday’s earnings call that at the end of 2024, the GSE grew its net worth to nearly $95 billion. Almodovar added that Fannie has built nearly $37 billion of regulatory capital over the past two years.

In 2024, Fannie Mae provided $381 billion of liquidity to the single-family and multifamily mortgage markets.

“This essential work helped approximately 1.4 million households buy, refinance or rent a home,” Almodovar said. “This helped 391,000 first-time homebuyers to buy a home. It also included about 420,000 units of multifamily rental housing, most of which are affordable for households earning at or below 120% of area median income.”

Chryssa C. Halley, the company’s chief financial officer, shed more light on the company’s revenues throughout 2024.

“Net revenues remained strong at $29 billion, thanks to a healthy guaranty fee income of $23 billion. Non-interest expenses were $9.8 billion, relatively flat to 2023. We recorded a $186 million benefit for credit losses in 2024,” Halley said during the call.

In Q4 2024, Halley said that Fannie’s $4.1 billion in net income was up from $4 billion in the prior quarter, which was “primarily due to an increase in fair value gains, partially offset by a shift to provision for credit losses.”

Single-family and multifamily results

For the company’s single-family segment, Fannie reported $14.4 billion in net income in 2024, a decrease of $425 million compared to 2023. Fannie Mae acquired approximately 778,000 single-family purchase loans totaling $326 billion, of which roughly half were for first-time homebuyers, as well as roughly 204,000 single-family refinances in 2024. Single-family acquisition volume was up 3% annually.

The credit profile of Fannie’s overall single-family book posted a weighted average mark-to-market loan-to-value ratio of 50% and a weighted average credit score at origination of 753, Halley noted. The single-family benefit for credit losses was $938 million.

Turning to multifamily, Fannie Mae reported $2.5 billion in net income in 2024, consistent with 2023. Compared to the prior year, the company reported a $74 million increase in net interest income in 2024, attributed to higher guaranty fee income from book growth. Fannie acquired approximately $55 billion in multifamily loans last year, up 4% from 2023.

“The multifamily provision increased by $257 million to $752 million, because of an incremental decline in property values, rising delinquencies, and the ongoing investigation of lending transactions with suspected fraud,” Halley told analysts. “We expect multifamily property values to stabilize in 2025.”

The GSE financed approximately 420,000 units of multifamily rental housing in 2024

Outlook for 2025

Halley ended the earnings call by touching on Fannie’s current economic outlook.

“Our economists do not expect a meaningful decline in the 10-year Treasury rate in 2025. As a result, mortgage rates are expected to remain elevated at above 6%, and we predict home sales will remain suppressed. Existing-home sales are expected to total 4.15 million units in 2025, an improvement over the approximately 4 million units in existing-home sales in 2024, but still down more than 20% compared to 2019,” Halley said.

Fannie anticipates new-home sales to strengthen throughout 2025 for an annualized sales pace of 738,000 units. It also projects year-over-year home-price growth to be 3.5% in 2025 compared to 5.8% in 2024.

The GSE forecasts that single-family mortgage originations will total about $1.9 trillion in 2025, up from an estimated $1.7 trillion in 2024. Purchase loans are expected to make up 74% of single-family originations this year, Halley said.

Fannie expects multifamily rent growth to be in the 2% to 2.5% range in 2025, and for vacancy rates to be between 6% and 6.25%. It also forecasts multifamily mortgage originations of $330 billion to $375 billion in 2025.