U.S. Economic, Housing and Mortgage Market Outlook May 2024

This report provides an analysis of the U.S. economic, housing, and mortgage market conditions as of May 2024. It outlines the moderation in economic growth, with the Real Gross Domestic Product (GDP) growth rate slowing to 1.6% in the first quarter of 2024, down from 3.4% in the previous quarter. The report details the impact of rising mortgage rates, which exceeded 7% in April, leading to a slowdown in the housing market characterized by declines in home sales and new construction. It highlights the labor market's cooling, with nonfarm payroll employment growth decreasing and the unemployment rate rising slightly. The report also discusses inflationary pressures, noting that the core Personal Consumption Expenditures (PCE) price index increased by 0.3% month-over-month in March, remaining above the Federal Reserve's target. The outlook anticipates continued challenges in the housing market due to high interest rates and limited inventory, while projecting modest growth in mortgage origination volumes despite these constraints.