Fannie Mae Home Price Expectations Survey (HPES) Q1 2026

On February 23, 2026, the Fannie Mae Q1 2026 Home Price Expectations Survey (HPES) results were released.  This survey is done on a quarterly basis.

Various Q1 2026 Fannie Mae Home Price Expectations Survey information is available, including the chart seen below:

As one can see from the above chart, the average expectation is that the residential real estate market, as depicted by the Fannie Mae Home Price Index, will continually climb.

The detail of the survey is interesting.  Of the survey respondents, only four (of the displayed responses) forecasts a cumulative price decrease through 2030.

The Median Cumulative Home Price Appreciation for years 2026-2030 is seen as 2.15%, 4.65%, 7.74%, 11.18%, and 14.80%, respectively.

For a variety of reasons, I continue to believe that these forecasts will prove far too optimistic.

I have written extensively about the residential real estate situation.  For a variety of reasons, it is exceedingly complex.  While many people continue to have an optimistic view regarding future residential real estate prices, in my opinion such a view is unsupported on an “all things considered” basis.  Residential real estate is an exceedingly large asset bubble. As such, from these price levels there exists potential for a price decline of outsized magnitude. 

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 6833.34 as this post is written

The U.S. Economic Situation – February 23, 2026 Update

Perhaps the main reason that I write of our economic situation is that I continue to believe, based upon various analyses, that our economic situation is in many ways misunderstood.  While no one likes to contemplate a future rife with economic adversity, current and future economic problems must be properly recognized and rectified if high-quality, sustainable long-term economic vitality is to be realized.

There are an array of indications and other “warning signs” – many readily apparent – that current economic activity and financial market performance is accompanied by exceedingly perilous dynamics.

I have written extensively about this peril, including in the following:

“Building Financial Danger” (ongoing updates)

“A Special Note On Our Economic Situation”

“Forewarning Pronounced Economic Weakness”

“Thoughts Concerning The Next Financial Crisis”

“Was A Depression Successfully Avoided?”

“Has the Financial System Strengthened Since the Financial Crisis?”

“The Next Crash And Its Significance”

My analyses continues to indicate that the growing level of financial danger will lead to the next stock market crash that will also involve (as seen in 2008) various other markets as well.  Key attributes of this next crash is its outsized magnitude (when viewed from an ultra-long term historical perspective) and the resulting economic impact.  This next financial crash is of tremendous concern, as my analyses indicate it will lead to a Super Depression – i.e. an economy characterized by deeply embedded, highly complex, and difficult-to-solve problems.

For long-term reference purposes, here is a chart of the Dow Jones Industrial Average since 1900, depicted on a monthly basis using a LOG scale (updated through February 20, 2026 with a last value of 49,625.97):

(click on chart to enlarge image)(chart courtesy of StockCharts.com)

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 6909.51 as this post is written

U.S. Deflation Probability Chart Through January 2026

For reference, below is a chart of the St. Louis Fed Price Pressures Measures – Deflation Probability [FRED STLPPMDEF] through January 2026.

While I do not necessarily agree with the current readings of the measure, I view this as a proxy of U.S. deflation probability.

A description of this measure, as seen in FRED:

This series measures the probability that the personal consumption expenditures price index (PCEPI) inflation rate (12-month changes) over the next 12 months will fall below zero.

The chart, on a monthly basis from January 1990 – January 2026, with a last reading of .00000, last updated on February 20, 2026:

Here is this same U.S. deflation probability measure since 2008:

source:  Federal Reserve Bank of St. Louis, Deflation Probability [STLPPMDEF], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed February 20, 2026: https://fred.stlouisfed.org/series/STLPPMDEF

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I post various economic indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this site are aware, I do not necessarily agree with what they depict or imply.

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The Special Note summarizes my overall thoughts about our economic situation

SPX at 6901.01 as this post is written

Velocity Of Money – Charts Updated As Of February 20, 2026

Here are two charts from the St. Louis Fed depicting the velocity of money in terms of the M1 and M2 money supply measures.

All charts reflect quarterly data through the 4th quarter of 2025, and were last updated as of February 20, 2026.

Velocity of M1 Money Stock, current value = 1.653:

Data Source: FRED, Federal Reserve Economic Data, Federal Reserve Bank of St. Louis; accessed February 20, 2026:
http://research.stlouisfed.org/fred2/series/M1V

–

Velocity of M2 Money Stock, current value = 1.409:

Data Source: FRED, Federal Reserve Economic Data, Federal Reserve Bank of St. Louis; accessed February 20, 2026: 
http://research.stlouisfed.org/fred2/series/M2V

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I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this site are aware, I do not necessarily agree with what they depict or imply.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 6882.85 as this post is written

Real GDP Chart Since 1947 – 4th Quarter 2025

For reference purposes, below is a chart reflecting Real GDP, as depicted, with value $24,111.830.  This chart incorporates the Gross Domestic Product, 4th Quarter 2025 (Advance Estimate) of February 20, 2026:

source: U.S. Bureau of Economic Analysis, Real Gross Domestic Product [GDPC1], retrieved from FRED, Federal Reserve Bank of St. Louis; accessed February 20, 2026: https://fred.stlouisfed.org/series/GDPC1

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I post various indicators and indices because I believe they should be carefully monitored.  However, as those familiar with this site are aware, I do not necessarily agree with what they depict or imply.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 6895.36 as this post is written

Trends Of S&P500 Earnings Forecasts

S&P500 earnings trends and estimates are a notably important topic, for a variety of reasons, at this point in time.

FactSet publishes a report titled “Earnings Insight” that contains a variety of information including the trends and expectations of S&P500 earnings.

For reference purposes, here are two charts as seen in the “Earnings Insight” report of February 13, 2026:

from page 30:

(click on charts to enlarge images)

from page 31:

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I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this site are aware, I do not agree with many of the consensus estimates and much of the commentary in these forecast surveys.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 6862.18 as this post is written

S&P500 EPS Forecasts For 2025-2027 As Of February 13, 2026

As many are aware, Refinitiv publishes earnings estimates for the S&P500.  (My other posts concerning S&P earnings estimates can be found under the S&P500 Earnings label)

The following estimates are from Exhibit 24 of the “S&P500 Earnings Scorecard” (pdf) of February 13, 2026, and represent an aggregation of individual S&P500 component “bottom up” analyst forecasts.  For reference, the Year 2014 value is $118.78/share; the Year 2015 value is $117.46/share; the Year 2016 value is $118.10/share; the Year 2017 value is $132.00/share; the Year 2018 value is $161.93/share; the Year 2019 value is $162.93/share; the Year 2020 value is $139.72/share; the year 2021 value is $208.12/share; the year 2022 value is $218.09/share; the year 2023 value is $221.36/share; and the year 2024 value is $242.73/share:

Year 2025 estimate:

$273.44/share

Year 2026 estimate:

$314.45/share

Year 2027 estimate:

$364.00/share

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I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this site are aware, I do not agree with many of the consensus estimates and much of the commentary in these forecast surveys.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 6836.17 as this post is written

Standard & Poor’s S&P500 EPS Estimates 2025 – 2026 – January 30, 2026

As many are aware, Standard & Poor’s publishes earnings estimates for the S&P500.  (My posts concerning their estimates can be found under the S&P500 Earnings label)

For reference purposes, the most current estimates are reflected below, and are as of January 30, 2026:

Year 2025 estimates add to the following:

-From a “bottom up” perspective, operating earnings of $265.42/share

-From a “bottom up” perspective, “as reported” earnings of $246.47/share

Year 2026 estimates add to the following:

-From a “bottom up” perspective, operating earnings of $310.24/share

-From a “bottom up” perspective, “as reported” earnings of $294.00/share

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I post various economic forecasts because I believe they should be carefully monitored.  However, as those familiar with this site are aware, I do not agree with many of the consensus estimates and much of the commentary in these forecast surveys.

_____

The Special Note summarizes my overall thoughts about our economic situation

SPX at 6836.17 as this post is written