Fannie Mae’s 2011 Economic Analysis-some good news

According to the February 2011 Economic Outlook released by Fannie Mae’s Economics & Mortgage Market Analysis Group. For 2011, economic growth is projected to accelerate to 3.7%, up from 2.8% economic growth in 2010. I know house sales are up in the New Bern, Havelock area.  On the upside, the excess supply of housing appears to have peaked. In addition, the rental vacancy rate fell, indicating the excess supply of housing is being worked off slowly—a trend necessary for housing to return to stability. The downward trend in the rental vacancy rate is consistent with the downward trend in the homeownership rate, which implies a rising share of households have chosen renting over owning. The homeownership rate fell to 66.5% in the fourth quarter of 2010, down from a peak of 69.2% in late 2004. Our projected annual growth rate for 2011 is nearly a full percent higher than the annual growth rate for 2010, which is a significant event,” said Fannie Mae Chief Economist Doug Duncan. “Economic cross currents such as the lack of sustained strong job growth, state and local fiscal issues and geo-political uncertainty in the Middle East present downside risks. Nevertheless, the positives outweigh the negatives.”

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