Each month, Fannie Mae’s Economic and Strategic Research Group releases an outlook detailing its expectations for the housing market and economy. According to its most recent forecast, the group foresees dampened housing activity through the end of the year, though they acknowledge the market’s direction is largely dependent on where mortgage rates head from here. “Our consumer survey suggests that households who are paying attention to the housing market continue to take a wait-and-see approach,” Doug Duncan, Fannie Mae’s senior vice president and chief economist, said. “This is consistent with our latest housing forecast, which does not foresee a dramatic change in activity until affordability improves.” Duncan says the most likely path to improved affordability is for mortgage rates to decrease from their current level. But the group doesn’t expect home sales to decline significantly, even if rates remain elevated, due to the recent improvement in available homes for sale. (source)
