Experts Say Mortgage Rates Could Fall Below 6% Later This Year

There's currently a lot of uncertainty surrounding the daily fluctuations in mortgage rates, but the key takeaway is this: rates have generally trended downward from their peak of nearly 8% last fall.

For those in the market to buy or sell a home, this trend is significant. Although rates will continue to fluctuate due to various economic factors (such as inflation and the Consumer Price Index, or CPI), it's important not to lose sight of the overall downward trend that experts predict will continue throughout the year.

While we may not see the historically low rates experienced during the pandemic, some analysts believe that rates could fall below 6% later this year. Dean Baker, Senior Economist at the Center for Economic Research, stated:

"Rates are unlikely to reach the lows seen during the pandemic, but we could soon see rates under 6.0 percent, which would be considered low by standards prior to the Great Recession."

This sentiment is echoed by the latest projections from Fannie Mae, which suggest that rates could dip below 6% by the end of the year (as illustrated in the green box in the chart below):

The chart displays Fannie Mae's mortgage rate projections for 2024, comparing the initial forecast from December to the updated forecast released a month later. The downward trend in projections indicates that experts are confident rates will continue to decline, provided inflation eases.

What This Means for You

It's crucial to remember that no one can predict the future with absolute certainty, and short-term fluctuations are normal. Don't let minor changes deter you. Keep your focus on the broader trend.

If you've found a home that fits your budget and needs in today's market, it may not be wise to wait for rates to fall below 6% in hopes of timing the market perfectly.

With rates already lower than they were last fall, there's an opportunity available now. Even a slight decrease in rates can significantly enhance your purchasing power.

Bottom Line

If you were considering a move last year but hesitated in hopes of lower rates, now might be the time to take action. Let's connect to start the process.

 

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