04/19/2024 | Press release | Distributed by Public on 04/19/2024 10:15
Helping lenders serve homebuyers and homeowners with affordable mortgages
Financing for quality, affordable rental housing in every market, every day
Reducing risk and enhancing housing finance liquidity
All Resources to Manage Financial Uncertainty
All Resources for Recovering from a Disaster
Recovery Assistance for Homeowners
Recovery Assistance for Renters
Key Takeaways:
The strong gain in control group retail sales in March, as well as upward revisions to prior months, presents some upside risk to our Q1 and Q2 consumption forecast. While we continue to believe the current pace of consumption relative to income growth is unsustainable in the long run, wealth effects from recent stock market and home price gains may be able to continue to propel consumption growth in the near term. The industrial production report, which saw a second consecutive monthly gain in the highly cyclical manufacturing sector, is also supportive of relatively strong near-term growth.
The pullback in existing home sales brought the quarterly figure in line with our expectations. It also confirmed our suspicion that the jump in February home sales was due to seasonal quirks and did not represent a sustainable rise in sales activity. Our current home sales forecast faces some downside risk from the recent runup in interest rates, but we continue to expect a gradual increase in sales activity as new listings continue to rise. The drop in single-family starts also brought the quarterly figure in line with our expectations. We expect some modest slowing in single-family construction next quarter because new starts have outpaced new sales in recent months. The first decline in single-family permits in more than a year is supportive of that forecast. Additionally, we continue to expect that multifamily construction will slow this year, in line with a further decline in permits.
Nathaniel Drake
Economic and Strategic Research Group
April 19, 2024
Opinions, analyses, estimates, forecasts, and other views of Fannie Mae's Economic and 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, 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, 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.