Housing sector awaits improvement in affordability; modest recession still expected

Despite ending the year on a stronger-than-anticipated footing, the economy is still expected to slip into a modest recession beginning in the first half of 2023, according to the January 2023 commentary from the Fannie Mae Economic and Strategic Research (ESR) Group.

The ESR Group views the current rate of consumption as unsustainable relative to disposable income and forecasts that an retrenchment of the consumer will be a major factor in the upcoming economic contraction. The ESR Group predicts Q4/Q4 GDP growth for 202