Fannie Mae: Housing market will stabilize in 2019
After multiple rate hikes brought volatility into the housing market, 2019 should see things stabilize as the pace of rate increases slows, according to researchers at Fannie Mae.
In its 2019 Economic and Housing Outlook, Fannie’s Strategic Research Group said it continues to predict a slowdown in economic growth in the year ahead, projecting a 2.2% decline in growth that it attributes mostly to decreased consumer spending.
But researchers also said that the Federal Reserve’s “dovish” stance on rate hikes in 2019 will help stabilize home sales. They predict only one rate hike in the year ahead.
Considering these projections, the group defined its theme for 2019: “The economy’s slowing, the Fed slows, housing plateaus.”
Researchers said they expect mortgage rates to change little in the year ahead, continuing to hover in the 4.5% range, which they said will allow homebuyers to adjust to the new rate environment after last year’s volatility.
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