on Friday, Average 30-year fixed mortgage rate jump to 7.19%. Mortgage rates have recovered somewhat over the past few months. Financial markets reacted to the stronger-than-expected labor market data and are now pricing in a higher probability that the Federal Reserve will keep interest rates higher for an extended period.
this 7.19% Mortgage rates were the second highest recorded by Mortgage News Daily since early November.Only the surpassed 7.22% That level was reached in July.
Soaring mortgage rates mean another drop in housing affordability in the US. For example, if a borrower took out a $500,000 mortgage at a fixed rate of 5.99% in early February 2023, the monthly principal and interest payments would be $2,995. However, at an interest rate of 7.19 percent (the average rate on Friday), the same borrower would pay $3,391 a month on the same size loan.
Looking ahead, economists highlight three factors that could improve housing affordability: higher incomes, lower home prices and lower mortgage rates. Of these factors, mortgage rates can exert the most substantial influence in the short term. That’s because house prices tend to be sticky, limiting income growth even in a strong labor market.
Where are mortgage rates headed? To get some clues, wealth Tracks mortgage rate forecasts from nine leading research firms. However, it’s important to acknowledge that predicting future mortgage rates is a challenging task, and recent history shows that mortgage rate forecasters have struggled.
Mortgage Bankers Association: Washington-based trade group 30-year fixed mortgage rates are expected to average 5.9% in the fourth quarter of 2023.After this year, the group expects mortgage rates to slide to 4.9% By the fourth quarter of 2024.
Morning Star: Economist for the Morningstar Project By 2023, the average 30-year fixed mortgage rate will be 6.25%, 5.0% 4.0% in 2024 and 4.0% in 2025.
Goldman Sachs: Investment Banking Project By 2023, the 30-year fixed mortgage rate will hit 6.4%.Goldman Sachs expects 30-year fixed mortgage rates to hit average in 2024 5.9%.
National Association of Realtors: NAR Economists Forecast The 30-year fixed mortgage rate will slip to 6.4% by the end of 2023, then drop to 6.0% 2024.
Morgan Stanley: Morgan Stanley’s MBS strategists see 30-year fixed mortgage rates starting in 2024 6.0%.
Moody’s Analytics: Mark Zandi, chief economist at Moody’s Analytics, said Moody’s financial intelligence unit still expects 30-year fixed mortgage rates to average 6.5 for most of 2023. %. wealth he is expected to slide to 6.0% By the end of 2024, it will reach 5.5% in 2025.
Realtor Network: Economists at home listing sites think 30-year fixed mortgage rates to start in 2024 6.1%.
Fannie Mae: Fannie Mae economists forecast that 30-year fixed mortgage rates will average 6.6% in the fourth quarter of 2023. fannie mae forecast Mortgage rates will fall to an average of 5.9% in the fourth quarter of 2024.Fannie Mae expects mortgage rates to fall to average levels this calendar year 6.1% 2024.
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