Housing Recession

Despite recent optimism surrounding the Federal Reserve’s “soft landing” strategy, economists at Fannie Mae are still expecting a mild recession next year. Fannie Mae’s Economic and Strategic Research Group wrote in a note that mixed economic signals this month make it difficult to guess the near future, but a “modest contraction” in early 2024 remains the most likely outcome of the Fed’s inflation fight. They cite consumption outpacing incomes, big differences between gross domestic product and gross domestic income over the past three quarters, and previous policy tightening still moving through the systems as signs of what’s to come. Additionally, households are expected to restrict spending in the latter part of the year as inflated prices catch up to budgets.…