10/25/2024 | Press release | Distributed by Public on 10/25/2024 12:37
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:
Existing home sales were a bit below our expectations in September. Still, we had previously observed only a small pickup in mortgage applications as rates fell over the summer, so the subdued sales figure is in line with our thinking that there is a waning pool of potential homebuyers at current affordability levels. With mortgage rates now up more than 40 basis points since the end of September, we don't expect a significant pickup in sales by the end of the year. However, the new home side remains a bright spot in the housing market. Considering revisions to previous months, the new sales figure was almost exactly in line with our forecast for the quarter. We view the current months' supply of new homes for sale as sort of a goldilocks zone for continuing sales transactions; it's high enough to encourage builders to continue to use incentives to move inventories but not so high that they're likely to meaningfully slow construction. Still, we note that the October and November readings of both existing and new home sales are likely to be volaille given hurricane disruptions, and the recent move back up in mortgage rates could act as a headwind. Still, the outlook for new single-family starts and construction remains generally positive given a lack of existing inventories available for sale in many metros.
Nathaniel Drake
Economic and Strategic Research Group
October 25, 2024
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.