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Shane Willis- MBA, CDPE's Blog

By Shane Willis, mba | Broker in Pensacola, FL

Fannie Mae: Economy hits and air pocket

So here at the beach we are already starting to see the stabalization of prices and even a slight tick upward. Baldwin county is showing smaller inventory. Ever wish you could time the market a little better??????? :) 

WASHINGTON – April 21, 2011 – Global events during March – ongoing political turmoil in the Middle East and North Africa, the surge in oil prices and supply disruptions from the tragedy in Japan – dampened U.S. economic growth in the first half of 2011, according to the April 2011 Economic Outlook released today by Fannie Mae’s Economics & Mortgage Market Analysis Group.

However, Fannie Mae expects the slowdown to be temporary, with a modest acceleration in economic growth projected for the second half of the year. The group forecasts economic growth to average 3.1 percent for 2011, a downgrade from 3.5 percent projected in the prior forecast.

Home sales were weak in the first part of 2011, with distressed sales (foreclosure and short sales) continuing to account for more than a third of total existing home sales. In turn, a rising share of distressed sales and the winding down of various programs to support the housing market have caused home price measures to decline.

“Home price expectations have deteriorated during the past several months, which could cause some potential homebuyers to remain on the sidelines – and further sharp cutbacks in housing demand would pose a risk to the fragile housing recovery,” says Fannie Mae Chief Economist Doug Duncan. “We expect a little more decline in house prices at the national level than we had thought previously, but expect prices to begin stabilizing later this year.”

On the upside, recent employment reports have been very strong, with more than 230,000 private sector payroll jobs added in each of the last two months. “We anticipate there will be continued reasonably good news in employment through the rest of the year,” said Duncan. “If that continues, we expect housing to move in a similar positive direction – hopefully by the second half of 2011.”


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