Each month, Fannie Mae’s Economic and Strategic Research Group releases an outlook detailing what it sees ahead for the housing market and overall economy. According to this month’s commentary, prospective home buyers may have reason for encouragement. That’s because the group says it’s revised its view on mortgage rates, and it now expects they will fall lower by the end of year. Mark Palim, Fannie Mae’s senior vice president and chief economist, says it should help give buyers a boost. “We expect the recent pullback in mortgage rates will provide a small boost to home sales this year,” Palim said. “While our latest forecast calls for a period of modestly slower economic growth, historically, interest rates have been the most important driver of home sales. We think mortgage rates will move even lower within the next quarter and ultimately close the year … low enough to generate some extra sales from any would-be buyers still waiting on the sidelines.” (source)
