home building and less lawsuit threats coming from the Consumer Financial Protection Bureau (CFPB) towards lenders could open up the credit box to more qualified borrowers. Smoke: Three overarching trends crash into each other in 2017. More demand from first-time buyers has the potential of pushing the share of first-time buyers closer to normal. Yet at the same time, mortgage rates are now higher than they have been in more than a year and are likely to continue increasing by at least another 50 basis points in 2017. Despite declining affordability from higher rates, demand will remain strong and the market will remain an overall “sellers’ market,” characterized by low and fast-moving inventory like we have been seeing for the last two years. Continued and even stronger economic growth will keep demand strong and will produce gains in sales and prices, but the higher rates and tight supply will act to constrain some of the growth. Muoio: Housing inventory will be a key determining factor in the housing market. In 2016, we saw low inventories constrain sales growth and enable substantial price gains, which has in turn weakened affordability for prospective homebuyers. We expect further price growth to entice more homeowners to list their homes, particularly as existing homeowners have greater equity, though this mild uptick will still leave inventory below prior cyclical

Two thousand and seventeen. This year should be an interesting year for the U.S. residential housing market.

But one word summarizes the new GOP administration: uncertainty.

With that in mind, Housing News Report asked several leading housing economists to take a glimpse into what might happen as President Trump journeys to “Make America Great Again.”

Not only is President Donald J. Trump moving into the White House, but a new group of cabinet appointments are surely going to shake up U.S. property markets. At Treasury, Steven Mnuchin, a Wall Street veteran and former Goldman Sachs banker, said he wants to privatize Fannie Mae and Freddie Mac, the mortgage finance giants nationalized in September 2008. At the U.S. Department of Housing and Urban and Development, Dr. Ben Carson, the retired neurosurgeon, will run the $48 billion bureaucracy with 8,500 employees created in 1965 by President Lyndon Johnson’s Great Society initiative.

Here’s what the experts are projecting for the residential real estate market in 2017:

1) What will be the most important housing market trend(s) in 2017 and why? Yun: Demographics and improving economy suggest that first-time homebuyers will come back in 2017. But potential policy changes could wield a larger influence. Changes to mortgage interest deduction can sap consumer confidence about buying a home or changes to Fannie/Freddie could disrupt the mortgage market. On potential positive policy changes, some changes to Dodd-Frank will permit more construction loans for

Nobody really knows what to expect in 2017.

ATTOM Data Solutions • P3

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