Due to improvements in the job market, increased demand for goods and services, and gains in consumer spending and confidence, Fannie Mae’s December 2010 Economic Outlook sees a brighter economic future in the new year. Fannie Mae forecasts an 18.5 percent increase in housing starts, a 20 percent rise in new home sales, and a four percent rise in existing home sales. Their Economics & Mortgage Market Analysis Group also expects GDP growth of 3.4 percent, a drop in unemployment, and a stronger labor market in 2011. Doug Duncan, Fannie Mae’s chief economist, said they expect people to take advantage of affordability conditions as their employment and income outlook brightens. More here and here.