US Home Sales Projected to Grow 7.1% in 2021, Drop for Next Two Years, Says Fannie Mae

Source: Reuters

Home sales across the US are projected to fall over the next two years, as limited supply and higher mortgage rates and prices slow down the residential real estate market. DXY down -0.31%, EUR USD UP +0.54%

• The state-backed enterprise’s Economic and Strategic Research Group increased its 2021 home sales growth forecast from an initial 5.3%, attributable to a projected year-end solid increase in home purchases.
• Meanwhile, the outlook showed home sales dropping 1.4% next year due to reduced listings and other factors, and dropping 3.8% in 2023.
• Fannie Mae stated that the projection is that mortgage rates continue to expand upward to hover around 3.2% in 2022, alongside further home prices increase.
• Mae further noted that the action by US Federal Reserve to tighten monetary policy to deal with inflation will integrate with supply constraints and rising home prices to slow down sales activity.