Fannie Mae: Home Prices To Decline Into Next Year

[laughingliberal]

Home prices will decline into next year, Fannie Mae said Thursday, reversing earlier projections that the housing market would stabilize this year.

Former Federal Reserve Chairman Alan Greenspan said Sunday on NBC's "Meet the Press" that a so-called double-dip recession was possible "if home prices go down."

Fannie's forecast, disclosed in its latest quarterly report filed with the Securities and Exchange Commission, shows that the government-owned mortgage giant has turned bearish on the housing market. Fannie Mae, the federal mortgage association, along with its sister entity, Freddie Mac, own or guarantee about half of all U.S. mortgages.

"We expect that home prices on a national basis will decline slightly in 2010 and into 2011 before stabilizing, and that the peak-to-trough home price decline on a national basis will range between 18 percent and 25 percent," the bailed-out behemoth said in its filing.

http://www.huffingtonpost.com/2010/08/06/fannie-mae-home-prices-to_n_672776.html

[Poboy]

1. Gee, you don't say... whoda thought? -nt

[xchrom]

2. Well - at least they weren't 'surprised' nt.

[Poboy]

5. Well they claim to be-

"reversing earlier projections that the housing market would stabilize this year"

Its all happy talk, catapulting propaganda, etc., all in attempt to wish it away.
I'm sure the bankers knew though, and no doubt they are making a killing.

[OhioChick]

13. No shit...

:rofl:

[Ricochet21]

14. I agree

I agree

[Stargazer09]

3. Great

And we have to sell our house and move next year. I was hoping for better news.

[tinymontgomery]

12. We put ours on the market

at the beginning of July. I've been a geo-bachelor for the last year and the three hour drive is getting old.

[dipsydoodle]

4. Presumably

the prices will settle back closer to what they would've been without artificial demand stoked by self-certification mortgages whatever.

Just for purpose of reference here's the UK situation from a few weeks back :

Lord Turner, the chairman of the Financial Services Authority, yesterday said the watchdog would press ahead with plans to ban self-certification mortgages as he unveiled research showing that an alarming 46 per cent of households have no money left – or even a shortfall – after paying their mortgages and living costs.

Lord Turner told the British Bankers' Association's annual conference that banks will in future have to conduct an "affordability test" on every mortgage they sell to address a looming crisis in the market.

http://www.independent.co.uk/news/business/news/fsa-to-ban-selfcertification-mortgages-2025953.html

[laughingliberal]

6. Home prices in much of our area are already below what they were in 1999.

I think that's worse than just a 'correction.'

[dipsydoodle]

8. Yes that is worse than a "correction"

I hadn't realised it was that bad - far far worse than I thought. Is that representative of the US in general or are there local reasons where you are ?

[laughingliberal]

11. Not sure. I'm in Nevada where everything is horrible.

The housing crash has destroyed our state. I don't know how that compares to the rest of the country but if prices continue down, I'm pretty sure we're looking at more than a correction in most places.

[pipi_k]

10. My own home's value was at its highest in 2003...from there

it's dropped some $60,000 to $70,000.

We tried to sell, but so far nothing. It comes off the market in October and we were thinking of doing it again next spring, but with this news, maybe it's best not to bother for another year or two.

[adnelson60087]

7. I do not see where they have factored in the Option Arms and Alt-A loans

that are resetting now. Also, though this article doesn't focus on commercial real estate, it should be noted that this sector is almost never mentioned. It is also a disaster in the making as retailers are forced out of business.

[laughingliberal]

9. Yes. Commercial Real Estate is a lurking monster.

Last year 25% of retail space here was vacant. Now it's worse.

[Ricochet21]

15. I agree

I agree