Housing Recovery Dependent on Inventory Reduction According to Fannie Mae's Economic & Mortgage Market Analysis Group

Employment Looks Promising, but It's Still Early in the Game

WASHINGTON, April 19, 2010 - Housing is stabilizing but excess inventory and shadow supply are
hindering recovery according to the April 2010 Economic Outlook released
today by Fannie Mae's (NYSE: FNM) Economics & Mortgage Market Analysis Group.
The outlook projects economic growth of 3.1 percent for all of 2010,
notwithstanding the recent dip in growth for the first quarter.

"Financial conditions are improving as seen by the unwinding of various
programs, most notably the MBS purchase program which ended in March. This is
strong evidence that the Fed believes the financial sector can stand on its
own," said Fannie Mae Chief Economist Doug Duncan. "We estimate that June
2009 was the end of the recession, a good sign that we're moving forward.
Nevertheless, significant improvements in the labor market and consumer
spending will be the big hurdles as we move toward recovery in the housing
market and broader economy."

New home sales are at record lows and will be slow to recover until
inventory of existing homes and the foreclosure overhang are worked off.
However, we see key indicators for existing home sales, including pending
home sales and purchase applications, are showing good signs of a pickup.

Jobs, a driving force for housing, are now moving in the right direction.
Fundamentals of the labor market appear to be improving as layoffs have
slowed and hiring is showing signs of life. March payroll employment
increased by 162,000, the largest gain in three years; temp employment posted
a sixth consecutive monthly gain; and the average workweek increased. On the
downside, unemployment will remain elevated for some time, despite the peak
unemployment rate of 10.1 percent likely having occurred in October 2009.

The Economic Outlook includes the Economic Developments commentary,
Economic Forecast, and Housing Forecast - which detail movement of interest
rates, the housing market, the mortgage market, and the overall economic
climate. To read the full April 2010 Economic Outlook, visit the Economics &
Mortgage Market Analysis (
www.fanniemae.com/media/economics/index.jhtml?p=Media&s=Economics+%26+Mortgage+Market+Analysis
) site at www.fanniemae.com.

Opinions, analyses, estimates, forecasts, and other views of Fannie Mae's
Economics & Mortgage Market Analysis (EMMA) group included in these materials
should not be construed as indicating Fannie Mae's business prospects or
expected results, are based on a number of assumptions, and are subject to
change without notice. Although the EMMA group bases its opinions, analyses,
estimates, forecasts, and other views on information it considers reliable,
it does not guarantee that the information provided in these materials is
accurate, current, or suitable for any particular purpose. Changes in the
assumptions or the information underlying these views could produce
materially different results. The analyses, opinions, estimates, forecasts,
and other views published by the EMMA group represent the views of that group
as of the date indicated and do not necessarily represent the views of Fannie
Mae or its management.

Fannie Mae exists to expand affordable housing and bring global capital
to local communities in order to serve the U.S. housing market. Fannie Mae
has a federal charter and operates in America's secondary mortgage market to
enhance the liquidity of the mortgage market by providing funds to mortgage
bankers and other lenders so that they may lend to home buyers. Our job is to
help those who house America.

Pete Bakel, Fannie Mae, +1-202-752-2034; Resource Center: +1-800-732-6643