The housing market will be stuck in a rut for a long time even if the US avoids a recession, Fannie Mae says

• The downturn in the US housing market isn’t ending anytime soon, Fannie Mae warned.
• That’s because mortgage rates are set to stay elevated if the US avoids a recession.
• Even if the US does tip into recession, tight financial conditions will still weigh on home sales.

The housing market isn’t coming out of its deep freeze anytime soon, even if the US economy manages to steer away from a recession in the next year, according to Fannie Mae economists.

The government-sponsored mortgage giant highlighted the stagnant US housing market, with existing home sales down 18.9% year per-year in June, according to Fannie Mae’s estimate. Mortgage applications, similarly, have fallen to a 28-year-low.