In a welcome shift, the feverish surge in mortgage rates that peaked at 7.79% in October 2023 seems to have peaked. The latest weekly data from Freddie Mac reveals a notable decline, settling at 7.22% by the end of November. While this downward trend signals a potential reprieve for the housing market, many buyers and sellers are wondering how low rates might go—and when.
The dip in mortgage rates from the October high offers a breath of relief for those closely watching the real estate market. The decline, though modest, hints at potential stabilization, providing a hope for prospective homebuyers and homesellers alike.
What's Next for Mortgage Rates?
Forbes released the following information expressing how some experts predict market conditions will affect the average 30-year, fixed-rate mortgage in 2024:
National Association of Realtors chief economist Lawrence Yun. “Mortgage rates look to head towards 7% in a few months and into the 6% range by the spring of 2024.”
RSM U.S. real estate senior analyst Crystal Sunbury. “Assuming no significant economic shocks, mortgage rates are likely to continue slowly easing over the next few months, to reach a 6% to 6.5% range by spring of 2024.”
Mortgage Bankers Association (MBA). MBA’s baseline forecast is for mortgage rates to end 2024 at 6.1% and reach 5.5% at the end of 2025 as Treasury rates decline and the spread narrows.
Bank of America head of retail lending Matt Vernon. “The Fed’s likely decision to cut rates in 2024 would be a key factor that could breathe new life into the housing market. However, it’s important to note that significant drops in mortgage rates might not happen in the early months of 2024. If any reductions occur, they are likely to be gradual, possibly beginning in the latter part of the year.”
Palisades Group chief investment officer and co-founder Jack Macdowell. “Our best guess is that mortgage rates will remain in the 7% to 7.25% range throughout Q1 2024. This view is based on the idea that inflation is trending positively toward the 2% target and the Federal Reserve is likely done raising interest rates in 2023.”
Ally Home president Glenn Brunker. “With the current mortgage rates pricing around 7.5% today, we can expect them to be nearing their top and begin their descent in the first half of 2024.”
Navigating these nuanced market conditions requires skill. Kelly offers a wealth of experience for both buyers and sellers and that’s exactly what you need in today’s market!