Fannie Mae’s Economic and Strategic Research Group releases a forecast each month looking at what’s ahead for the housing market and overall economy. According to their most recent release, there’s reason to be optimistic. For one, the group sees the economy bouncing back this year.
The combination of warmer weather and the COVID-19 vaccine rollout will have things picking up starting in spring and continuing into the second half of 2021. Housing activity is also expected to be strong, though it should settle a bit from last year’s accelerated pace. Doug Duncan, Fannie Mae’s senior vice president and chief economist, says the slow down will be modest.
“Our latest forecast projects that the continued waning of pent-up demand from last year’s delayed spring home buying season, coupled with a modest rise in interest rates, will likely slow the pace of housing, measured both by the volume of mortgages refinanced and by the pace of home sales,” Duncan said. “However, in our view, a modest slow down in the sales pace is unlikely to prevent year-end 2021 home sales from being higher than 2020.” (source)