It’s too soon to know if the current negative trends, such as limited housing supply and the effect of higher rates, which have defined the mortgage market in 2018 will continue into next year. On the other hand, it is possible that the market will adjust and resume modest growth, according to the November Forecast from Freddie Mac.

“Almost all the trends in the U.S. housing market have been negative in recent months as housing market activity continues to adjust to higher mortgage rates,” said Sam Khater, chief economist for Freddie. “If new home sales are to resume growth in 2019, builders might have to shift their focus to more modestly priced homes and smaller sized homes to help offset housing affordability concerns. But with cost pressures pinching profitability, this will be a significant challenge.”

Several highlights from the Forecast are as follows:

• Expect GDP growth to average 3 percent in 2018 before slowing to 2.4 percent in 2019 and 1.8 percent in 2020.
• Expect total home sales to decrease 1.6 percent to 6.02 million in 2018 before slowly regaining momentum and increasing 1 percent to 6.08 million in 2019 and 2 percent to 6.20 million in 2020.
• Expect home prices to increase 5.1 percent in 2018 with the rate of growth moderating to 4.3 percent in 2019 and 2.9 percent in 2020.
• Expect single-family mortgage originations to decline 9.9 percent year-over-year to $1.63 trillion in 2018, falling slightly to $1.62 trillion in 2019 and dropping e to $1.60 trillion in 2020. The performance is the result of shrinking refinance activity.
• Adjusted for inflation in 2017 dollars, an estimated $14.2 billion in net home equity was cashed out during the refinance of conventional prime-credit home mortgages in the third quarter of 2018, down from $18.3 billion a year earlier and substantially less than the peak cash-out refinance volume of $102 billion during the second quarter of 2006.

Mortgage delinquencies fell by 8.2 percent in October are now down by nearly 18 percent from the same time last year. Serious delinquencies, loans 90 or more days past due, fell by 14,000 from last month, and 90,000 year over year, a 12-year low.

Improvements in hurricane-related delinquencies associated with Harvey and Irma, which spiked in late 2017, are contributing to the strong year-over-year improvements. Despite foreclosure starts seeing a monthly increase from September's nearly 18-year low, the number of loans in active foreclosure fell slightly from September and has decreased by 24 percent from last year

Last, prepayment activity, driven primarily by housing turnover, climbed 14 percent, but remains 29 percent below last year's level.

National housing statistics at a glance are as follows:

• Total U.S. loan delinquency rate (loans 30 or more days past due, but not in foreclosure): 3.64%
  Month-over-month change: -8.19%
  Year-over-year change: -17.93%
• Total U.S. foreclosure pre-sale inventory rate: 0.52%
  Month-over-month change: -0.54%
  Year-over-year change: -24.24%
• Total U.S. foreclosure starts: 50,600
  Month-over-month change: 26.50%
  Year-over-year change: 0.80%
• Monthly prepayment rate: 0.80%
  Month-over-month change: 13.59%
  Year-over-year change: -28.67%
• Foreclosure sales as % of 90+: 1.95%
  Month-over-month change: 27.74%
  Year-over-year change: 15.32%
• Number of properties that are 30 or more days past due, but not in foreclosure: 1,884,000
  Month-over-month change: -165,000
  Year-over-year change: -378,000
• Number of properties that are 90 or more days past due, but not in foreclosure: 499,000
  Month-over-month change: -14,000
  Year-over-year change: -90,000
• Number of properties in foreclosure pre-sale inventory: 267,000
  Month-over-month change: -1,000
  Year-over-year change: -81,000
• Number of properties that are 30 or more days past due or in foreclosure: 2,152,000
  Month-over-month change: -165,000
  Year-over-year change: -458,000

Housing Statistics, by state, are as follows:

The National Association of Realtors supports the FHFA’s decision to increase the loan limit on conforming loans to $484,350 in 2019, from $453,100. In addition, the high-cost limit will rise to $726,525, from $679,650. As a result, loan limits will be higher in all but 47 counties or county equivalents across the country beginning on January 1.

The Federal Housing Finance Agency's limits define the maximum one-unit single-family mortgage amounts that Fannie Mae and Freddie Mac may finance and are also used to define the loan limits for the Federal Housing Administration's program. Each year, the FHFA updates the national and high-cost limits based on its national price index.

These limits are important for funding home sales in high-cost coastal markets in California, Virginia, and Maryland. They are gaining importance in other markets, including Nashville, Denver, Utah and Wyoming.

The decision reflects rising or near record high home prices in many markets: If the loan limits didn’t keep up with home price growth, borrowers across the country risk being pushed out of the market altogether as mortgage rates and rising home prices continue to hold back potential homebuyers," said John Smaby, president of NAR, and a second-generation agent and broker at Edina Realty.

The market for private financing has improved but remains hobbled since the Great Recession, requiring more onerous standards of would-be homebuyers who do not possess pristine credit, or they face higher rates than those charged by the enterprises.