Existing Home Sales on Pace to Hit Nearly 30-Year Low, Despite Recently Lower Rates
Fannie Mae's Economic and Strategic Research (ESR) Group forecasts existing home sales to hit a nearly 30-year low in 2024, despite lower mortgage rates and improved supply in some regions. The slowest pace since 1995 is expected due to home-purchase demand at current affordability levels. Regional variations in housing supply are creating divergent affordability conditions, with significant inventory increases in Sun Belt and Mountain West regions. The ESR Group predicts that mortgage rates will average 5.7% by the end of 2025.
Economic growth outlook remains mostly unchanged, with the economy likely shifting into a slower growth path. The Federal Reserve is expected to move towards a more neutral monetary policy stance as inflation approaches the 2% target. Real GDP growth is anticipated to remain subdued before returning to the long-term trend by late 2025.
Il Gruppo di Ricerca Economica e Strategica (ESR) di Fannie Mae prevede che le vendite di case esistenti raggiungeranno un livello quasi minimo in quasi 30 anni nel 2024, nonostante tassi ipotecari più bassi e un' offerta migliorata in alcune regioni. Si prevede il ritmo più lento dal 1995 a causa della domanda di acquisto di case ai livelli attuali di accessibilità. Le variazioni regionali nell'offerta abitativa stanno creando condizioni di accessibilità divergenti, con aumenti significativi dell'inventario nelle regioni del Sun Belt e del Mountain West. Il Gruppo ESR prevede che i tassi ipotecari saranno in media del 5,7% entro la fine del 2025.
Le prospettive di crescita economica rimangono per lo più invariate, con l'economia che probabilmente si sposterà verso un percorso di crescita più lento. Si prevede che la Federal Reserve si muova verso una politica monetaria più neutra man mano che l'inflazione si avvicina all'obiettivo del 2%. La crescita del PIL reale è attesa rimanere contenuta prima di tornare alla tendenza a lungo termine entro la fine del 2025.
El Grupo de Investigación Económica y Estratégica (ESR) de Fannie Mae pronostica que las ventas de viviendas existentes alcanzarán un mínimo casi de 30 años en 2024, a pesar de tasas hipotecarias más bajas y una oferta mejorada en algunas regiones. Se espera que el ritmo más lento desde 1995 se deba a la demanda de compra de casas a los niveles actuales de asequibilidad. Las variaciones regionales en la oferta de vivienda están creando condiciones de asequibilidad divergentes, con aumentos significativos de inventario en las regiones del Sun Belt y del Mountain West. El Grupo ESR predice que las tasas hipotecarias promediarán el 5.7% para finales de 2025.
Las perspectivas de crecimiento económico permanecen mayormente sin cambios, con la economía probablemente cambiando a un camino de crecimiento más lento. Se espera que la Reserva Federal se dirija hacia una postura de política monetaria más neutral a medida que la inflación se acerque al objetivo del 2%. Se anticipa que el crecimiento del PIB real seguirá siendo modesto antes de regresar a la tendencia a largo plazo a finales de 2025.
Fannie Mae의 경제 및 전략 연구(ESR) 그룹은 기존 주택 판매가 2024년에 거의 30년 최저치에 이를 것으로 전망하고 있으며, 이는 낮은 모기지 금리와 일부 지역의 개선된 공급에도 불구하고 그렇습니다. 현재의 주택 구매 수요로 인해 1995년 이후 가장 느린 속도가 예상됩니다. 주택 공급의 지역적 차이가 상이한 구매력 조건을 만들어내고 있으며, Sun Belt와 Mountain West 지역에서는 상당한 재고 증가가 있었습니다. ESR 그룹은 2025년 말까지 모기지 금리가 평균 5.7%에 이를 것으로 예측합니다.
경제 성장 전망은 대부분 변하지 않으며, 경제는 느린 성장 경로로 전환될 가능성이 높습니다. 연방준비제도(Fed)는 인플레이션이 2% 목표에 가까워짐에 따라 더 중립적인 통화 정책으로 나아갈 것으로 예상됩니다. 실제 GDP 성장은 2025년 말까지 장기 추세로 돌아오기 전에 저조할 것으로 예상됩니다.
Le groupe de recherche économique et stratégique (ESR) de Fannie Mae prévoit que les ventes de logements existants atteindront un niveau presque record depuis près de 30 ans en 2024, malgré des taux hypothécaires plus bas et une amélioration de l'offre dans certaines régions. Le rythme le plus lent depuis 1995 est attendu en raison de la demande d'achat de maisons aux niveaux actuels d'accessibilité. Les variations régionales de l'offre de logements créent des conditions d'accessibilité divergentes, avec des augmentations significatives des stocks dans les régions du Sun Belt et des montagnes de l'Ouest. Le groupe ESR prévoit que les taux hypothécaires atteindront en moyenne 5,7 % d'ici fin 2025.
Les perspectives de croissance économique demeurent globalement inchangées, l'économie étant susceptible de se diriger vers un chemin de croissance plus lent. La Réserve fédérale devrait adopter une politique monétaire plus neutre à mesure que l'inflation approche de l'objectif de 2 %. La croissance du PIB réel devrait rester modérée avant de revenir à la tendance à long terme d'ici fin 2025.
Die Wirtschafts- und Strategieforschung (ESR) Gruppe von Fannie Mae prognostiziert, dass die Verkäufe bestehender Häuser 2024 ein fast 30-jähriges Tief erreichen werden, trotz niedrigerer Hypothekenzinsen und verbesserter Angebotslage in einigen Regionen. Die langsamste Rate seit 1995 wird aufgrund der Nachfrage nach Hauskäufen auf dem aktuellen Erschwinglichkeitsniveau erwartet. Regionale Unterschiede im Wohnungsangebot schaffen divergente Erschwinglichkeitsbedingungen, wobei es in den Regionen Sun Belt und Mountain West zu signifikanten Bestandszunahmen kommt. Die ESR-Gruppe prognostiziert, dass die Hypothekenzinsen bis Ende 2025 im Durchschnitt 5,7 % betragen werden.
Der Ausblick für das Wirtschaftswachstum bleibt weitgehend unverändert, wobei die Wirtschaft vermutlich auf einen langsameren Wachstumspfad umschwenkt. Die Federal Reserve wird voraussichtlich eine neutralere Geldpolitik anstreben, da die Inflation das Ziel von 2 % erreicht. Das reale BIP-Wachstum wird voraussichtlich gedämpft bleiben, bevor es bis Ende 2025 wieder zum langfristigen Trend zurückkehrt.
- Mortgage rates have declined significantly in recent weeks
- Home supply has increased by nearly 20% from year-ago levels
- Inflation is moving closer to the 2% target
- Existing home sales forecast to be the slowest since 1995
- home-purchase demand at current affordability levels
- Softness in pending home sales and purchase mortgage applications
- No significant increase in loan application activity despite lower mortgage rates
- Real GDP growth expected to remain subdued in coming quarters
Mortgage Rates Now Forecast to Average
The ESR Group's economic growth outlook was mostly unchanged this month, as incoming data has been largely consistent with expectations. The ESR Group notes that the economy is likely shifting into a slower growth path, and as inflation moves closer to the 2-percent target, the Federal Reserve is poised to move monetary policy toward a more neutral stance. Still, the ESR Group believes the lagged effect of monetary policy is likely to keep real gross domestic product growth subdued in coming quarters before returning to the long-term trend by the end of 2025.
"Increasingly, regional variations in housing supply are creating divergent affordability conditions and experiences for consumers on both sides of the home sales transaction; however, taken as a whole, home sales activity, particularly on the existing side, remains near what we consider to be the floor of basic demographic and household mortgage demand," said Doug Duncan, Fannie Mae Senior Vice President and Chief Economist. "Supply has risen significantly in many Sun Belt states, where such factors as ease of new home development and increasing insurance costs are having an impact, but at the national level the supply shortage still very much applies. Although mortgage rates have fallen considerably in recent weeks, we've not seen evidence of a corresponding increase in loan application activity, nor has there been an improvement in consumer homebuying sentiment. We think it's likely that many would-be borrowers are waiting for affordability to improve even further, and that some may be anticipating additional declines in mortgage rates given expectations that the Fed will lower the federal funds target rate. Others may be waiting for household incomes to improve further to offset some of the recent home price growth, or they may be thinking that future supply growth will ease affordability. Regardless of the lever, we expect affordability to remain the primary constraint on housing activity for the foreseeable future, and we now think full-year 2024 will produce the fewest existing home sales since 1995."
Visit the Economic & Strategic Research site at fanniemae.com to read the full September 2024 Economic Outlook, including the Economic Developments Commentary, Economic Forecast, Housing Forecast, and Multifamily Market Commentary. To receive e-mail updates with other housing market research from Fannie Mae's Economic & Strategic Research Group, please click here.
Opinions, analyses, estimates, forecasts, beliefs, and other views of Fannie Mae's Economic & Strategic Research (ESR) Group included in these materials should not be construed as indicating Fannie Mae's business prospects or expected results, are based on a number of assumptions, and are subject to change without notice. How this information affects Fannie Mae will depend on many factors. Although the ESR Group bases its opinions, analyses, estimates, forecasts, beliefs, and other views on information it considers reliable, it does not guarantee that the information provided in these materials is accurate, current, or suitable for any particular purpose. Changes in the assumptions or the information underlying these views could produce materially different results. The analyses, opinions, estimates, forecasts, beliefs, and other views published by the ESR Group represent the views of that group as of the date indicated and do not necessarily represent the views of Fannie Mae or its management.
About the ESR Group
Fannie Mae's Economic and Strategic Research Group, led by Chief Economist Doug Duncan, studies current data, analyzes historical and emerging trends, and conducts surveys of consumer and mortgage lender groups to provide forecasts and analyses on the economy, housing, and mortgage markets. The ESR Group was awarded the prestigious 2022 Lawrence R. Klein Award for Blue Chip Forecast Accuracy based on the accuracy of its macroeconomic forecasts published over the 4-year period from 2018 to 2021.
About Fannie Mae
Fannie Mae advances equitable and sustainable access to homeownership and quality, affordable rental housing for millions of people across America. We enable the 30-year fixed-rate mortgage and drive responsible innovation to make homebuying and renting easier, fairer, and more accessible. To learn more, visit: fanniemae.com | X (formerly Twitter) | Facebook | LinkedIn | Instagram | YouTube | Blog
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