Freddie: 2018 ‘Looking Pretty Good’ for Economy, Housing

Bolstered by economic gains, home-building, prices and sales are all forecasted to outdo 2017 this year, according to Freddie Mac researchers.

In Freddie’s January Outlook, “Maintaining Momentum: 2018 and Beyond,” analysts believe the economy is moderating—growing 2.5 percent in 2018, versus 2.6 percent in 2017—but, expect home prices to increase 5.7 percent, sales to increase to 6.35 million and starts to increase to 1.3 million.

The dichotomy could exacerbate unaffordability, the researchers say. Generally, however, the market is on-track.

“Starting off the year, things are looking pretty good for the U.S. economy and housing markets,” says Len Kiefer, deputy chief economist at Freddie Mac. “Mortgage rates are low, economic growth has accelerated in recent quarters, and housing is coming off its best year in a decade. Although housing markets have been improving year-after-year for nearly a decade, there’s still room for improvement. We forecast moderating growth in U.S. housing market activity through the next two years.”

Is a downturn looming? Current indicators, such as the Treasury yield curve and unemployment rate, could point to a recession, so researchers have yet to rule it out.

“There are factors worth keeping an eye on in 2018,” Kiefer says. “Namely, is another recession on the horizon, how will housing markets respond to declining housing affordability, and how will young adults move the housing market? More are living at home with their parents today than in 2000.”

Source: Freddie Mac

DeVita_Suzanne_60x60Suzanne De Vita is RISMedia’s online news editor. Email her your real estate news ideas at For the latest real estate news and trends, bookmark

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