Housing Forecast: May 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 1,063 969 1,055 1,170 1,225 1,245 1,315 1,350 1,365 1,003 1,105 1,319

Single-Family (1 Unit) 602 625 652 705 636 705 780 830 850 920 950 965 648 738 921

Percent Change: Year-over-Year 4.9% 13.9% 24.9%

Multifamily (2+ Units) 323 360 378 358 333 350 390 395 395 395 400 400 355 367 398

New Single-Family Home Sales 431 427 434 471 513 511 534 560 574 619 640 652 436 529 621

Percent Change: Year-over-Year 1.6% 21.4% 17.3%

Total Existing Home Sales (Single-Family, Condos and Co-Ops) 4,677 4,887 5,057 5,060 4,967 5,160 5,166 5,172 5,226 5,258 5,266 5,324 4,940 5,116 5,268

Percent Change: Year-over-Year -2.9% 3.6% 3.0%

Total Home Sales (New + Existing) 5,108 5,314 5,491 5,531 5,480 5,671 5,700 5,732 5,800 5,876 5,907 5,976 5,376 5,646 5,890

Percent Change: Year-over-Year -2.6% 5.0% 4.3%

Home Prices (NSA, Thous. $)

Median New 274 282 278 301 284 291 287 314 297 304 300 327 284 294 307

Median Total Existing 191 212 216 208 204 219 224 216 213 228 233 225 208 216 225

FHFA Purchase-Only Index (Percent Change: Quarterly YoY, Annual Q4/Q4) 6.9% 5.6% 4.7% 4.9% 4.3% 3.7% 3.8% 4.5% 5.1% 4.4% 4.4% 4.2% 4.9% 4.5% 4.2%

Mortgage Rates (Percent)

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

5-Year Adjustable Rate Mortgage 3.1 3.0 3.0 3.0 2.9 2.9 3.0 3.1 3.2 3.4 3.5 3.5 3.0 3.0 3.4

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

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

Mortgage Originations 240 312 336 296 340 418 369 333 244 315 318 302 1,184 1,460 1,179

Purchase 123 190 194 169 150 213 209 188 144 222 226 207 676 759 799

Refinance 116 122 142 127 190 205 160 145 101 93 92 95 508 701 381

Refinance Share (%) 49% 39% 42% 43% 56% 49% 43% 44% 41% 29% 29% 31% 43% 48% 32%

Liquidations 260 315 317 284 325 340 318 315 210 251 247 266 1,176 1,298 974

Mortgage Debt Outstanding (NSA, Bil. $)

MDO Single-Family First Lien (1-4 Units) 9,161 9,159 9,177 9,190 9,205 9,282 9,333 9,352 9,386 9,450 9,521 9,557 9,190 9,352 9,557

Percent Change: Quarterly Annualized Rate, Annual Q4/Q4 -0.9% -0.1% 0.8% 0.5% 0.7% 3.4% 2.2% 0.8% 1.5% 2.8% 3.0% 1.5% 0.1% 1.8% 2.2%

MDO Total Single-Family (1-4 Units) 9,851 9,843 9,857 9,862 9,878 9,963 10,020 10,041 10,081 10,152 10,231 10,272 9,862 10,041 10,272

Percent Change: Quarterly Annualized Rate, Annual Q4/Q4 -1.3% -0.4% 0.6% 0.2% 0.7% 3.5% 2.3% 0.9% 1.6% 2.9% 3.1% 1.6% -0.2% 1.8% 2.3%

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

May 11, 2015

Note: Interest rate forecasts are based on rates from April 30, 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 (ESR) group

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