The housing market has been sort of a mixed bag this year. While home sales are expected to exceed last year’s levels and mortgage rates are still hovering near record lows, fewer houses for sale have presented potential home buyers in many markets with increased competition and higher prices. In short, you could look at the numbers and come to a couple of different conclusions. As an example, two recently released forecasts have differing views on what lies ahead for the residential real estate market. Fannie Mae’s Economic & Strategic Research Group’s October 2016 Economic and Housing Outlook sees housing momentum beginning to slow. Doug Duncan, Fannie Mae’s chief economist, says recent declines in sales, construction, and mortgage applications may mean continued weakness in the near term. However, Duncan also acknowledges the fact that improved demand from first-time home buyers is an encouraging sign. On the other side of the fence, Freddie Mac’s most recent forecast calls for continued gains and calls the housing market an economic bright spot. “As the economy sputters along a little bit faster than stall speed, the U.S. housing market continues to be a bright spot, though there’s less room to run than in the prior few years,” Sean Becketti, Freddie Mac’s chief economist, says. “We see new home sales improving some next year driven by increases in single-family housing construction which will push total home sales slightly higher.” More here.
