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Rates To Remain Steady Amid Economic Rebound

When the coronavirus vaccines were first announced last fall, expectations for the economy began to grow. Economists predicted the economy would rebound as newly vaccinated Americans returned to activities restricted by the pandemic. Now, according to the most recent forecast from Fannie Mae’s Economic and Strategic Research Group, the rebound has started. “The ramp-up we’d previously forecast for the economy is underway, as evidenced by, among other measures, increasing airline passenger reservations and restaurant bookings,” Doug Duncan, Fannie Mae’s senior vice president and chief economist, said. “Vaccinations are continuing to roll out, and consumers appear to be increasingly looking toward post-pandemic life.” So what does this mean for the housing market? Well, for one, the group expects mortgage rates to remain steady in the near term. That means, despite recent increases, rates should stay favorable. That’ll help drive demand from home buyers, which Fannie Mae expects will rise from last year’s level. They also expect prices to continue to climb this year, though they see increases decelerating in 2022. (source)