Frowning takes 68 muscles.
Smiling takes 6.
Pulling this trigger takes 2.
I'm lazy.
Posted on 01/21/2011 5:55:57 AM PST by woodbutcher1963
Fannie Mae: Housing starts to triple by 2013 to nearly 1.5 millionby CHRISTINE RICCIARDI Wednesday, January 19th, 2011, 11:44 am
Despite the still fragile housing market, Fannie Mae expects housing starts to triple by 2013.
According to the agency's economic outlook, housing starts are predicted to increase 17.3% and hit 710,000 this year, with another 47% increase to 1.1 million in 2012 and another gain of 42% in 2013 to nearly 1.5 million.
In 2010, there were about 510,000 housing starts.
"We expect a small rise in home sales this year, but significant amounts of supply and shadow inventory of expected foreclosures will continue to hamper a robust housing picture for some time," said Doug Duncan, Fannie Mae's chief economist.
The government-sponsored enterprise projects total sales of new and existing homes to climb 4.5% in 2011 to 5.43 million, following an estimated decline of 6% for 2010 to about 5.2 million from 5.53 million for 2009.
Mortgage originations will drop to $1.04 trillion this year from $1.53 trillion last year. Fannie Mae also expects mortgage rates will increase in 2011, but not substantially.
"Fixed mortgage rates are projected to rise throughout the year, but to remain below 5.5%," the report said. "Larger increases in mortgage rates without corresponding acceleration in job gains would pose a risk to the housing recovery."
The median new home price in 2011 is expected to drop, as is the median existing home sale price, down 2.1% to $214,500 and 2.1% to $167,900, respectively.
Fannie Mae expects the U.S. economy to "accelerate and sustain" above-par and less volatile growth in 2011 based on increased consumer spending and growing clarity concerning fiscal policy.
According to the agency's economic outlook, Fannie Mae anticipates the economy to grow by 3.6% this year with consumer and business spending leading the way. This prediction was revised upward from 2.8% in December.
"The economy has regained momentum entering 2011 and we see significant improvement in the economy's ability to grow compared to 2010," said Duncan.
Write to Christine Ricciardi.
That will keep prices depressed for quite some time.
Fannie Mae management required a forecast that would maintain their cap requirements.
BY making this number official Fannie can forgo writing off at least another $100Billion in loan losses between now and April 2013 when they’ll be required to revise their estimates.
This might be a good thing for taxpayers if enough garbage gets shoved through the REO pipeline and Obama isn’t reelected.
Even a RINO like Christie or Guiliani would wipe out FHA/Ginnie Fannie Freddie if in 2013 they have an overhang of 2 years worth of write offs that the management blackholed to maintain their cap requirements to maintain their employment and fat bonuses at the Agencies.
That fat scumbag Richardson from New Mexico just did it in the last weeks of his term, “oh hey, forgot to mention it, but the budget deficit is 100% larger than previously admitted, see ya, peace out suckahs!”
This article was forwarded to me yesterday by another lumber trader I work with. All of us called BS on in.
However, starts are going up from the low of 500,000 but nobody believes we will hit 1.5 million by 2013. I think the 700m # for this year is possible.
Most people do not understand that houses on the average need to be replaced every 75 years. With 300 million people, most economists will state that we need to build 1-1.2 million just to keep up with population growth.
Starts peaked in 2005 at 2.2 million. They bottomed out at 500,000. It is going to take awhile to get back to 1 million.
I posted this article because I like to get the reaction of the people on this board. The reactions were exatly what I thought. The fact is the most people judge the economy based on their own personal experience. It happens in my industry all the time. Just because things are slow in AZ has little to do with things in TX.
IN the age of self selecting news consumption, what else can you expect? Got to agree with you on that.
Otherwise, I’m certain 5+ unit multi-unit housing will be bullish as early as 3Q 2011, pent up demand side of the equation for new households is going to bring back rental market almost across the board,
That being said, the report you posted in the original article was all politics, all the time...
Today’s news:
From Nick Timiraos at the WSJ: Fannie-Freddie Report Likely to Be Late
http://online.wsj.com/article/SB10001424052748704115404576096301759391950.html
The administration now plans to release the report by mid-February ... once a final report is released it is likely to contain two or three proposals for what should replace Fannie and Freddie ...
One of the proposals will outline a way for the government to continue backing certain mortgage-backed securities, while another will discuss how to structure a market with no government guarantees. ... any transition period could take between 15 and 20 years, according to Barclays.
“Otherwise, I’m certain 5+ unit multi-unit housing will be bullish as early as 3Q 2011, pent up demand side of the equation for new households is going to bring back rental market almost across the board,”
Rental’s have increased all over the country because people involved in foreclosures need to live somewhere.
Another big change is the average new home size is decreasing. The age of the McMansion is over except for real millionaries(people who have millions in liquid assets). As the population ages the baby boomers are going into condos and assisted living centers.
I knew my original post was political in nature. However, it is fun to get the reactions of the people on this board that are ALWAYS BEARISH. They can not seperate their politics from their view of reality.
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