Existing Home Sales Forecast Revised Lower in Latest Outlook

Rhea-AI Summary

Fannie Mae's Economic and Strategic Research Group has revised its forecast for existing single-family home sales in 2025 downward to 4.14 million units from the previous estimate of 4.24 million units. The adjustment is primarily attributed to updated mortgage rate projections, which are now expected to reach 6.5% by the end of 2025 and 6.1% by the end of 2026. The outlook also includes GDP growth projections of 1.4% for 2025 and 2.2% for 2026 on a Q4/Q4 basis. This forecast revision reflects Fannie Mae's updated economic analysis and housing market expectations for the coming years.

Positive

• GDP growth projected to increase from 1.4% in 2025 to 2.2% in 2026
• Mortgage rates expected to decrease from 6.5% in 2025 to 6.1% by end of 2026

Negative

• Existing home sales forecast reduced by 100,000 units to 4.14 million for 2025
• Higher mortgage rate expectations than previously forecasted
• Continued high mortgage rates above 6% through 2026

WASHINGTON, June 23, 2025 /PRNewswire/ -- Existing single-family home sales are forecast at 4.14 million units for 2025, down slightly from last month's forecast of 4.24 million units, according to the June 2025 Economic and Housing Outlook from the Fannie Mae (OTCQB: FNMA) Economic and Strategic Research (ESR) Group. Revisions to the home sales forecast were driven in part by the ESR Group's higher expectations for mortgage rates, which are now predicted to end 2025 and 2026 at 6.5% and 6.1%, respectively. The latest outlook also projects real gross domestic product growing at 1.4% in 2025 and 2.2% in 2026 on a Q4/Q4 basis.

Visit the Economic and Strategic Research site at fanniemae.com to read the full June 2025 Economic and Housing Outlook, including the Economic Developments Commentary, Economic Forecast, and Housing Forecast. To receive email updates with other housing market research from Fannie Mae's Economic and Strategic Research Group, please click here.

Opinions, analyses, estimates, forecasts, beliefs, and other views of Fannie Mae's Economic and Strategic Research (ESR) Group included in these materials should not be construed as indicating Fannie Mae's business prospects or expected results, are based on a number of assumptions, and are subject to change without notice. How this information affects Fannie Mae will depend on many factors. Although the ESR Group bases its opinions, analyses, estimates, forecasts, beliefs, and other views on information it considers reliable, it does not guarantee that the information provided in these materials is accurate, current, or suitable for any particular purpose. Changes in the assumptions or the information underlying these views could produce materially different results. The analyses, opinions, estimates, forecasts, beliefs, and other views published by the ESR Group represent the views of that group as of the date indicated and do not necessarily represent the views of Fannie Mae or its management. 

About the ESR Group
Fannie Mae's Economic and Strategic Research Group, led by Chief Economist Mark Palim, studies current data, analyzes historical and emerging trends, and conducts surveys of consumer and mortgage lenders to inform forecasts and analyses on the economy, housing, and mortgage markets.

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SOURCE Fannie Mae

FAQ

What is Fannie Mae's revised forecast for existing home sales in 2025?

Fannie Mae revised its forecast for existing single-family home sales in 2025 to 4.14 million units, down from the previous forecast of 4.24 million units.

What are FNMA's projected mortgage rates for 2025 and 2026?

Fannie Mae projects mortgage rates to end at 6.5% in 2025 and decrease to 6.1% by the end of 2026.

What is Fannie Mae's GDP growth forecast for 2025 and 2026?

Fannie Mae forecasts real GDP growth of 1.4% in 2025 and 2.2% in 2026 on a Q4/Q4 basis.

Why did Fannie Mae lower its home sales forecast for 2025?

Fannie Mae lowered its home sales forecast primarily due to higher expectations for mortgage rates.

How much did FNMA reduce its 2025 existing home sales forecast?

Fannie Mae reduced its 2025 existing home sales forecast by 100,000 units, from 4.24 million to 4.14 million units.