There’s a lot of confusion in the market about what’s happening with day-to-day movement in mortgage rates right now. Compared to the near 8% peak last fall mortgage rates have been trending down overall. But what you need to know is that some experts say mortgage rates may fall below 6% later this year.
And if you’re looking to buy or sell a home, this is a big deal. While rates are going to continue to bounce around a bit based on various economic drivers (like inflation and reactions to the consumer price index, or CPI), don’t let the short-term volatility distract you. The experts agree the overarching downward trend should continue this year.
While we won’t see the record-low rates homebuyers got during the pandemic, some experts think we should see rates dip below 6% later this year. As Dean Baker, Senior Economist, Center for Economic Research, says:
“They will almost certainly not fall to pandemic lows, although we may soon see rates under 6.0 percent, which would be low by pre-Great Recession standards.”
And Baker isn’t the only one saying this is a possibility. The latest Fannie Mae projections also indicate we may see a rate below 6% by the end of this year (see the green box in the chart below):
The chart shows mortgage rate projections for 2024 from Fannie Mae. It includes the one that came out in December and compares it to the updated 2024 forecast they released just one month later. And if you look closely, you’ll notice the projections are on the way down.
As they watch current market trends and the broader economy, it’s normal for experts to adjust their forecasts. What this shows is that experts are feeling confident rates should continue to decline, if inflation cools.
What This Means for You
But remember, no one can say with certainty what will happen (and by when), and short-term volatility is to be expected. So, focus on the bigger picture and don’t let small fluctuations make you afraid.
If you’ve found a home you love in today’s market – especially where finding a home that meets your budget and your needs can be a challenge – it’s probably not a good idea to try to time the market and wait until rates drop below 6%.
With rates already lower than they were last fall, you have an opportunity in front of you right now. That’s because even a small quarter-point dip in rates gives your purchasing power a boost.
Bottom Line
If you wanted to move last year but were holding off hoping rates would fall, now that experts say mortgage rates may fall could make this spring the time to act. Let’s connect to get the ball rolling. Experts Say Mortgage Rates May Fall
Bay Shores Real Estate is a full-service real estate services firm with a highly personal approach and we would love the opportunity to help you find the life you love! With offices in Newport, RI, Bay Shores serves clients throughout Rhode Island and Southeastern Massachusetts. We can help you find the home that’s perfect for you! And we will be right there with you through the entire buying process!
