Fannie “Real Estate Owned” inventory increased in Q4; Expected to increase further in 2023

by Calculated Risk on 2/20/2023 01:37:00 PM

Fannie reported results for Q4 2022. Here is some information on single-family Real Estate Owned (REOs). 

First, a note on the pandemic from Fannie:

“In response to the COVID-19 pandemic, a number of legislative and executive actions were taken by the federal
government and state and local governments to assist affected borrowers and renters and to slow the spread of the
, including actions that applied to the loans we guarantee. While most of these actions are no longer in effect,
the COVID-19 national emergency remains in place. In January 2023, the Administration announced it intends to extend
the COVID-19 national emergency to May 11, 2023, and end the emergency on that date. We continue to offer
forbearance relief and other home retention solutions to borrowers affected by the COVID-19 pandemic …”
 emphasis added

One of those actions was a foreclosure moratorium that ended in mid-2021. Since then, foreclosures have increased slightly.

Fannie Mae reported the number of REOs increased to 8,779 at the end of Q4 2022, up 23% from 7,166 at the end of Q4 2021.  For Fannie, this is down 95% from the 166,787 peak number of REOs in Q3 2010.

Fannie and Freddie REO Click on graph for larger image.

Here is a graph of Fannie Real Estate Owned (REO).

This is well below a normal level of REOs for Fannie, and REO levels will increase further in 2023, but there will not be a huge wave of foreclosures.

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