"At the outset of the year we forecasted that 2013 would witness sustainable but below-par growth as the economy begins its transition to more normal levels. Halfway through the year our view is little changed" says Fannie Mae Chief Economist Doug Duncan. "We expect approximately 2.1 percent growth over the course of 2013 up from the anemic pace of 1.7 percent in 2012. This is consistent with the incremental improvement seen over the past few years but still below the economy's potential. Our forecast calls for growth to push past 2.5 percent in 2014 boosted largely by tailwinds from the strengthening housing market."
Housing was largely positive entering the spring/summer season with various indicators such as home prices home sales and homebuilding activity showing signs of long-term improvement toward normal levels. Despite rising mortgage rates during the past month which have affected refinance originations affordability conditions remain high and should not present a significant obstacle to potential homebuyers.
For an audio synopsis of the June 2013 Economic Outlook listen to the podcast on the Economic & Strategic Research.
For more information visit www.fanniemae.com.