Economic growth was weaker than expected during the second quarter of the year, according to a new statement from Fannie Mae’s Economic & Strategic Research Group. But despite disappointing second quarter economic activity, the group hasn’t changed its outlook for the housing market this year. In fact, there are plenty of positive signs to be found. Fannie Mae’s chief economist, Doug Duncan, points to the fact that job creation remains steady and full-time employment is getting closer to pre-recession numbers. Household net worth also continues to rise, though income growth could use more improvement. “We hold by our previous comments that income growth still needs to strengthen, particularly for younger households, in order to drive significant housing growth, but we are nonetheless seeing some positive improvements in the housing sector,” Duncan said. “Home sales have trended up and inventories are lean, supporting strong home price appreciation. That price growth, driven by laggard supply response, helps build equity for existing owners but is a headwind for first-time buyers.” Still, Fannie Mae expects mortgage rates to rise only gradually through the next year, which should help keep buying affordable despite steady price gains. More here.