Fannie Mae released its Economic and Housing Outlook for October revealing that housing demand continues to outstrip supply, compounding affordability issues. Fannie Mae went on to say that it expects supply constraints and diminishing, pent-up demand will lead to a pullback in sales activity in 2021. For 2020, expectations are calling for total home sales to rise by 3.6% from 2019. Fannie Mae went on to say that it sees purchase originations up 13% in 2020 to $1.5 trillion and expects purchase volumes to rise a further 5% in 2021.
The housing market continues to produce solid numbers fueled by low mortgage rates. The NAHB Housing Market Index rose to a record high 85 in October surpassing the record 83 in September. Any number over 50 indicates that more builders view conditions as good than poor. All components within the report saw increases. “The housing market continues to be a bright spot for the economy, supported by increased buyer interest in the suburbs, exurbs and small towns,” said NAHB Chief Economist Robert Dietz.