Housing Forecast: March 2015

14.1 14.2 14.3 14.4 15.1 15.2 15.3 15.4 16.1 16.2 16.3 16.4 2014 2015 2016

Housing Starts and Sales (SAAR, Thous. Units)

Housing Starts 925 985 1,030 1,065 1,085 1,130 1,180 1,225 1,245 1,315 1,350 1,365 1,003 1,155 1,319

Single-Family (1 Unit) 602 625 652 706 700 740 790 830 850 920 950 965 647 765 921

Percent Change: Year-over-Year 4.8% 18.2% 20.4%

Multifamily (2+ Units) 323 360 378 359 385 390 390 395 395 395 400 400 356 390 398

New Single-Family Home Sales 431 427 434 466 478 495 521 549 580 618 641 651 437 511 623

Percent Change: Year-over-Year 1.9% 16.9% 21.8%

Total Existing Home Sales (Single-Family, Condos and Co-Ops) 4,603 4,867 5,123 5,070 5,092 5,131 5,175 5,194 5,208 5,257 5,267 5,321 4,940 5,148 5,263

Percent Change: Year-over-Year -2.9% 4.2% 2.2%

Total Home Sales (New + Existing) 5,034 5,294 5,557 5,536 5,570 5,626 5,696 5,744 5,788 5,875 5,907 5,972 5,377 5,659 5,886

Percent Change: Year-over-Year -2.6% 5.2% 4.0%

Home Prices (NSA, Thous. $)

Median New 274 282 278 300 286 293 288 313 299 304 299 325 283 295 307

Median Total Existing 191 212 216 208 200 220 225 217 209 228 233 225 208 215 224

FHFA Purchase-Only Index (Percent Change: Quarterly YoY, Annual Q4/Q4) 6.9% 5.6% 4.7% 4.9% 4.7% 3.9% 4.1% 4.6% 4.6% 4.0% 3.9% 4.0% 4.9% 4.6% 4.0%

Mortgage Rates (Percent)

30-Year Fixed Rate Mortgage 4.4 4.2 4.1 4.0 3.7 3.8 3.9 4.0 4.1 4.1 4.2 4.2 4.2 3.9 4.2

5-Year Adjustable Rate Mortgage 3.1 3.0 3.0 3.0 3.0 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.0 3.1 3.5

1-Year Adjustable Rate Mortgage 2.5 2.4 2.4 2.4 2.4 2.6 2.7 2.8 2.9 3.0 3.1 3.2 2.4 2.6 3.0

Single-Family Mortgage Originations (NSA, Bil. $, 1-4 Units)

Mortgage Originations 240 312 336 296 272 329 333 304 261 321 320 304 1,184 1,239 1,206

Purchase 123 190 194 169 119 192 195 178 142 217 220 203 676 684 781

Refinance 116 122 142 127 153 138 138 126 119 104 100 101 507 554 424

Refinance Share (%) 49% 39% 42% 43% 56% 42% 41% 42% 46% 33% 31% 33% 43% 45% 35%

Liquidations 261 318 317 300 247 307 284 273 258 252 249 246 1,195 1,111 1,007

Mortgage Debt Outstanding (NSA, Bil. $)

MDO Single-Family First Lien (1-4 Units) 9,162 9,157 9,176 9,172 9,197 9,219 9,268 9,299 9,302 9,370 9,441 9,498 9,172 9,299 9,498

Percent Change: Quarterly Annualized Rate, Annual Q4/Q4 -0.9% -0.2% 0.8% -0.2% 1.1% 1.0% 2.1% 1.4% 0.1% 3.0% 3.0% 2.5% -0.1% 1.4% 2.1%

MDO Total Single-Family (1-4 Units) 9,853 9,841 9,855 9,846 9,873 9,898 9,952 9,987 9,993 10,069 10,147 10,212 9,846 9,987 10,212

Percent Change: Quarterly Annualized Rate, Annual Q4/Q4 -1.4% -0.5% 0.6% -0.4% 1.1% 1.0% 2.2% 1.4% 0.2% 3.1% 3.1% 2.6% -0.4% 1.4% 2.2%

Adjustable Rate Mortgage Share of Conventional Mortgage Applications (%) 9% 10% 9% 9% 7% 8% 8% 8% 8% 8% 8% 8% 9% 8% 8%

March 10, 2015

Note: Interest rate forecasts are based on rates from February 27, 2015.

Note: All mortgage originations data are Fannie Mae estimates as there is no universal source for market-wide originations data.

Note: Unshaded areas denote actuals. Shaded areas denote forecasts.

Sources: Actuals: Census Bureau, National Association of REALTORS®, Federal Housing Finance Agency, Freddie Mac, Federal Reserve Board. Forecasts: Fannie Mae Economic & Strategic Research

Opinions, analyses, estimates, forecasts, and other views of Fannie Mae's Economic & 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, 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, 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.

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ECONOMIC AND STRATEGIC RESEARCH