Fannie Mae predicts bear market ahead for U.S. home sales

Fannie Mae, formally known as government-sponsored Federal National Mortgage Association, has dramatically downgraded home sales forecasts for the next two years.

Officials say they expect a modest recession in the second half of 2023 because of Fed tightening and the war in Ukraine.

As a caution, Fannie Mae representatives said they do not expect the recession to resemble the severity or duration of the Great Recession but higher mortgage rates will cause home sales to decline by 7.4% in 2022 and by 9.7% in 2023.

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