Mortgage rates dropped for the second consecutive week, falling to 2.98% annual percentage rate (APR) for 30-year mortgages, according to the latest data from Freddie Mac’s Primary Mortgage Market Survey. This drop occurred despite recent actions from the Fed that typically lead to rising rates.
"Despite the re-acceleration of economic growth, the recent bond rally drove mortgage rates down for the second consecutive week," Freddie Mac Chief Economist Sam Khater said. "These low mortgage rates, combined with the tailwind of first-time homebuyers entering the market, means that purchase demand will remain strong into next year. However, affordability pressures continue to be an ongoing concern for homebuyers."
If you are interested in saving on your monthly mortgage payment, consider refinancing your loan to lower your mortgage rate. Visit Credible to compare multiple lenders and find your personalized rate.
Mortgage rates not rising as economists predicted
The 30-year fixed-rate mortgage decreased by 0.11 percentage points — dropping from 3.09% last week to 2.98% for the week ending Nov. 10th. This is still up from the rate at the same time last year, which was 2.84%. Additionally, the 15-year mortgage rate hit 2.27%, which is down from 2.35% last week and 2.34% last year.
The five-year Treasury-indexed hybrid adjustable-rate mortgage (ARM) also decreased, falling to 2.53% from 2.54% last week and 3.11% last year.
"The Freddie Mac fixed rate for a 30-year loan moved lower for a second consecutive week, dropping back 11 basis points to 2.98% as investors adjust to the post-Fed announcement landscape," Realtor.com Chief Economist Danielle Hale said. "This marks the first time in a month that rates have registered below 3%.
"Even as the Fed has pulled back on purchases of mortgage-backed securities and inflation continues to run high – factors that tend to drive rates higher – the uptick hasn’t been as fast or as strong as expected, causing some investors to reevaluate their positions and build momentum behind the drop in rates," Hale said.
If you are interested in taking advantage of lower interest rates, consider a mortgage refinance to lower your monthly payment. Visit Credible to compare multiple mortgage lenders at once without affecting your credit score.
Economists continue to predict rise in rates
Despite two weeks of mortgage rate decreases, economists continue to expect higher interest rates in the near future as the Federal Reserve tapers off its economic stimulus.
"Going forward, our expectation is that despite recent moves lower, mortgage rates will begin to climb as the Fed reduces its purchase of mortgage-backed securities by $5 billion per month in November and December," Hale said. "While rising home prices and mortgage rates mean higher overall housing costs, homebuyers can prepare by rate-proofing their budgets. Buyers can use online tools like mortgage affordability calculators to know how rate increases will impact monthly costs and adjust their expectations and plans accordingly."
In fact, as record-high inflation numbers continue to emerge, St. Louis Federal Reserve Bank President James Bullard said in an interview on Fox Business that the Fed could raise interest rates twice in 2022.
Borrowers interested in getting a mortgage or refinancing their home before today’s mortgage rates rise should contact Credible to speak to a home loan expert and get all of their questions answered.
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