The first Freddie Mac Primary Mortgage Market Survey of 2021 showed that we are now in uncharted territory with regard to home mortgage rates. The average 30-year fixed rate mortgage came in at 2.65%, the lowest rate in the survey’s history, dating back to 1971. 15-year fixed rate mortgages averaged 2.16%. Since then, rates have climbed up a bit, to 2.93% (30-year fixed) and 2.47% (15-year fixed), which is still at historically low levels.
Unfortunately, housing is not becoming more affordable as a result. Home prices have risen faster than rates have fallen; average prices were up 7.9% in October of 2020 compared with 12 months previous, and the National Association of Realtors is expecting new home prices to rise by 21% this year, while existing home prices will climb 9%. Those predictions might be higher than reality, however, since there is a chance that the foreclosure moratoriums in place today will be allowed to expire later this year.
This article was written by an independent writer for Brewster Financial Planning LLC and is not intended as individualized legal or investment advice.