Friday, June 21, 2024

Experts predict mortgage rates will continue to decline through 2024, despite recent slight increase [Video]

Mortgage Rates Rise to 6.69%: Hope for Improved Affordability

Are you in the market to buy a house? Well, now might be the perfect time to make your move! According to Freddie Mac, the average rate for a 30-year mortgage loan has risen to 6.69% from 6.60% a week prior. However, don’t let this minor climb discourage you, as mortgage costs have actually decreased by over 110 basis points in the last three months since peaking at 7.79% in October.

This trend is sparking hope for improved affordability, as rates are expected to continue dropping. While rates are still higher than the average in 2021 and 2022, consumers are showing increased interest in the housing market. More buyers are applying for mortgages, indicating a belief that home prices will also decrease along with mortgage rates.

Mark Palim, vice president and deputy chief economist at Fannie Mae, predicts that home sales, particularly existing home sales, will pick up around 4% this year. Additionally, there is a forecasted nearly 14% increase in 2025, as the lower mortgage rates work their way through the system.

Homebuyers are starting to see a glimmer of hope, with mortgage applications increasing by 3.7% from the previous week. The seasonally adjusted purchase index, which measures new home loans, jumped 8% week over week. Despite this positive trend, the unadjusted purchase index remains lower than the same week a year ago, and refinance activity is also down.

Americans are feeling more optimistic about the housing market, with the Home Purchase Sentiment Index showing an increase in the share of respondents believing now is a “good time” to buy a home. This growing positivity is attributed to consumers’ expectations of falling mortgage rates and home prices.

Looking ahead, economists at Fannie Mae predict that economic growth will slow in 2024, bringing rates down to around 5.8% by the end of the year. The Fed is expected to cut rates four times this year, although the first cut may come later than anticipated due to higher-than-targeted inflation.

So, if you’ve been considering buying a home, now might be the time to take the plunge. Keep an eye on mortgage rates and market trends, and you could find yourself in your dream home sooner than you think. Happy house hunting!

Disclaimer: The information provided in this article is for informational purposes only and should not be considered as financial advice. The content is based on general research and may not be accurate, reliable, or up-to-date. Before making any financial decisions, it is recommended to consult with a professional financial advisor or conduct thorough research to verify the accuracy of the information presented. The author and publisher disclaim any liability for any financial losses or damages incurred as a result of relying on the information provided in this article. Readers are encouraged to independently verify the facts and information before making any financial decisions.

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