Freddie Mac’s first quarterly forecast for 2022 cites the need for improvement in the nation’s employment picture. Even though the December report from the Bureau of Labor Statistics showed the unemployment rate down 0.3 percentage points from the prior month at 3.9 percent, Freddie Mac’s economists say that job openings remain high at 10.6 million and nonfarm payrolls are 3.6 million lower than pre-COVID-19 levels. Even though the Consumer Price Index hit a 40-year annual high of 7.0 percent in December with the core CPI coming in at 5.5 and the Federal Reserve expected to begin to taper its asset purchase and raise the fed funds rate, Freddie Mac does not expect mortgage rates to spiral higher. They forecast the 30-year fixed rate, which hovered around 3.0 percent most of last year, to average 3.6 percent this year and 3.9 percent next year. Home sales were strong in 2021, expected to total 7.1 million units. Freddie Mac expects that demand will be stable this year due to low mortgage rates and the number of first-time buyers and other “demographic tailwinds.” The company is looking for only a small decline to 6.9 million total sales this year and 7.0 million in 2023. The increase in rates will cause some moderation in demand and deceleration of home price increases from the probably 15.9 percent rate last year to 6.2 percent this year and 2.5 percent in 2023. It is only fair to add that appreciation has been predicted to cool rapidly by most analysts for the past several years.