Fannie Mae cut its forecast of industrywide home purchase lending for 2014 to $710 billion from $732 billion, underscoring the housing industry's struggles despite overall positive signs for the economy.

Existing home sales, new home sales, housing starts and multifamily data all suffered first-quarter year-over-year declines despite improving consumer attitudes, noted Fannie Mae's chief economist, Doug Duncan, in the government-sponsored enterprise's May forecast. Furthermore, concerns over the Federal Reserve's tapering of monetary stimulus could affect home sales and loan originations.

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