Tag Archives: Forecasts

Inconsistencies in the economy during the first quarter have not dampened Freddie Mac’s forecast for housing for the coming year. Freddie Mac has held fast to its prediction that 2016 will be the best year for housing since before the crisis. Why is the outlook for housing so rosy?

The signature report from CoreLogic Chief Economist Dr. Frank Nothaft offers viewers a few twists, turns and apparent contradictions.

The expected interest rate hike from the Federal Reserve is also swaying the views of many consumers for the housing market, causing many to believe that getting a mortgage will be more difficult next year.

In January, the company forecasted total national housing market growth for 2015 to reach 1.3 percent, more than five percent lower than growth for 2014 at 6.7 percent. The adjusted forecast presumes that year-end national growth will come in at 2.6 percent, falling within the projected range of 1 percent to 3 percent.

Freddie Mac's April prediction for GDP growth of 2.6 percent is a slight decline from March's forecast of 2.8 amid disappointing incoming data from the first quarter and harsh winter weather. This did not put a damper on Freddie Mac's overall forecast for housing, however. In fact, the title of the report, "Great Expectations," indicated that analysts at Freddie Mac still believe 2015 will be the best year for housing since the pre-recession days.

In its latest look at resale data, NAR reported that the stock of available existing homes for sale was around 1.85 million in December, putting the national supply at 4.4 months at the current sales rate. Also challenging the housing market right now are stringent credit conditions, stagnant wages, and "lingering wariness about homeownership benefits," said Auction.com's chief economist, Peter Muoio.

Despite many beginning-of-the-year predictions about spring growth in the housing market falling flat, and despite a still chugging economy that changes its mind quarter-to-quarter, economists at the National Association of Realtors and other industry groups expect an uptick in the economy and housing market through next year.