Most experts believe we'll see mortgage rates likely going down in the week of January 16th to 22nd, 2025. That's the general consensus, with a significant 67% of those polled by Bankrate predicting a decrease. However, it's not a done deal, and some are still betting on rates going up. So, let's dig in deeper and explore what's behind these predictions, and what it might mean for you.
Mortgage Rate Predictions Next Week January 16 to 22, 2025
I know, numbers can be a bit dry, but they tell a story. As of January 15th, 2025, the average 30-year fixed mortgage rate stood at 7.19 percent, according to Bankrate's survey of big lenders. That's a bit higher than the 7.08% we saw the previous week, which can feel discouraging if you’re trying to buy a house, or even refinance.
But here’s where the hope comes in: recent inflation data has given the market a bit of a confidence boost. Core inflation numbers came in lower than expected, which is like music to the ears of economists and, more importantly, those hoping to snag a lower mortgage rate.
- The Big Picture: This dip in inflation is encouraging, as it suggests that the efforts to bring prices under control might finally be working.
- What it means for Mortgages: When inflation seems to be slowing, the bond market reacts positively, which can lead to a decrease in bond yields, which in turn often leads to lower mortgage rates. It's a complicated chain reaction, but it often works, and it is what most experts are predicting will happen.
The Experts Weigh In: A Divided Camp
Now, this isn't a unanimous choir singing the same tune. While a solid majority predict rates will fall, there are a couple of holdouts who think things might go the other way. Here's a breakdown of what the experts are saying:
- Those Predicting a Decrease (67%): This is the largest group, and they're feeling pretty good about the recent inflation news. They believe that the market had perhaps overreacted to previous worries about inflation and the Federal debt and that a correction is due. Their argument is that with lower inflation, there’s less pressure on the Federal Reserve to keep interest rates high, allowing mortgage rates to come down. Experts like Michael Becker of Sierra Pacific Mortgage and Melissa Cohn of William Raveis Mortgage are in this camp. They see the lower inflation numbers as a clear signal for rate drops. Also experts like Heather Devoto and Dan Green also feel that the recent rise is an overreaction and will see a dip as rates reset.
- Experts like Dick Lepre, Joel Naroff, Les Parker and Greg McBride (Chief Financial Analyst, Bankrate) all see a reduction in mortgage rates in the coming week.
- Those Predicting an Increase (25%): This group is smaller but quite vocal. They’re worried about things like the high level of Federal debt, which can put upward pressure on bond yields and, therefore, mortgage rates. They argue that despite the recent positive inflation data, there are still underlying issues in the economy that could keep rates elevated or even push them higher. Experts like Robert Brusca and Ken Johnson are in this camp. They think we're not out of the woods yet, and they’re not convinced that rates will fall significantly any time soon. They have a point, and I feel, they are also a very reliable voice.
- Another expert, Sean P. Salter, Ph.D, also believes that the trend of rising mortgage rates will continue in the near future.
- Those Predicting No Change (8%): This is the smallest group, and they believe that, for now, rates will hold steady. Experts like Denise McManus are in this category. They feel that the recent economic data is mixed, with both good and bad signs, which could result in the market basically staying put.
My Two Cents: What I Think is Going On
Okay, so, based on all of this, here’s what I’m thinking. I tend to lean towards the idea that rates will see some decrease next week. The dip in inflation is a strong indicator, and the market often reacts quickly to such news. I have personally followed the market for many years now. I do, however, agree with the experts who think that this decline might not be a dramatic plunge but a gradual easing.
I think that even the people who are expecting a hike in rates understand that the markets cannot keep going up and up. So, I think that even their prediction is based on very slight increase as opposed to a drastic spike.
It's important to remember that the mortgage market is incredibly dynamic. It's like a rollercoaster, full of twists and turns. Things can change in a heartbeat based on the latest data, news from the Fed, and even global events. I have seen market sentiment shift on a simple tweet. So, while the experts may be doing their best to predict where things are heading, the market can, and often does, have a mind of its own.
Recommended Read:
Mortgage Rates Rise Past 7% in January: Highest in 7 Months
Mortgage Rates Rise to the Highest Level Since July Last Year
What Does This Mean For You?
If you’re in the market to buy a house or refinance your mortgage, this next week could be an interesting one. Here are a few things to consider:
- Don't Panic: If you're thinking of buying a house, don't rush into a decision based on a single week's predictions. Mortgage rates, while important, are only one part of a bigger picture.
- Do your research: Rates might come down, but also might rise. So it's important to check current mortgage rates from various lenders to find one that suits you best. The Bankrate website has a comprehensive list of lenders that could be helpful.
- Shop around: Different lenders may offer slightly different rates and terms. It’s worth taking the time to compare. Don't just go with the first lender you find. Take your time. Also try to understand how much will the rate impact your overall payment. Sometimes, a difference of even a few basis points, can add up to a huge difference in the long run.
- Look at the overall economic scenario: Don't just focus on what will happen next week. Look at the big picture, and then decide what to do. If you feel confident that the inflation is under control, and the market is going down, then it's probably a good time to buy. But if you see some underlying issues in the economy, it's probably not a good time to rush in.
- Consider your financial situation: Can you afford the payments even if rates don’t drop as much as expected? It’s wise to have a buffer. Think about your budget and what you are comfortable with. Make sure the rates and the repayments work for you and your particular situation.
- Don’t Get Too Fixated on the Lowest Rate: While getting the best possible rate is great, don’t let it be the only thing you focus on. A slightly higher rate might come with better loan terms or a lender you feel more comfortable working with.
Key Takeaways and Next Steps
To recap, here are the major points we've covered:
- The majority of experts (67%) predict that mortgage rates will decrease in the week of January 16th to 22nd, 2025.
- A smaller percentage (25%) thinks rates will increase, while another 8% believe they will stay the same.
- The main reason for the optimistic view is the recent decrease in core inflation.
- However, concerns about Federal debt persist.
- The market can change fast, and these predictions are never a guarantee of future rates.
- It is always advisable to do your own research, shop around and consider your overall financial situation before making any decision.
So, what should you do next?
- Stay Informed: Keep an eye on the news, especially any updates about inflation and the Federal Reserve. There are a lot of great resources out there like the Bankrate website for up to date data.
- Talk to a Professional: If you’re serious about buying a house, it's a good idea to consult with a mortgage professional. They can offer tailored advice based on your specific situation.
- Use online calculators: Online mortgage calculators can help you estimate how much you will have to pay if you are considering buying a house. They can also be helpful if you are looking to refinance your existing home.
- Be Patient: Don’t feel pressured to rush into a decision. Take your time, weigh your options carefully, and make the best choice for you.
The mortgage market is complex, but by staying informed and being prepared, you can navigate it with more confidence. As I mentioned earlier, I have been following the trends for many years now, and it's always useful to take multiple perspectives into consideration. I hope this analysis and these points help you take the right steps as you explore your options.
Work with Norada in 2025, Your Trusted Source for
Real Estate Investing
With mortgage rates fluctuating, investing in turnkey real estate
can help you secure consistent returns.
Expand your portfolio confidently, even in a shifting interest rate environment.
Speak with our expert investment counselors (No Obligation):
(800) 611-3060
Recommended Read:
- 30-Year Mortgage Rate Forecast for the Next 5 Years
- 15-Year Mortgage Rate Forecast for the Next 5 Years
- Why Are Mortgage Rates Going Up in 2025: Will Rates Drop?
- Why Are Mortgage Rates So High and Predictions for 2025
- NAR Predicts 6% Mortgage Rates in 2025 Will Boost Housing Market
- Mortgage Rates Predictions for 2025: Expert Forecast
- Will Mortgage Rates Ever Be 3% Again: Future Outlook
- Mortgage Rates Predictions for Next 2 Years
- Mortgage Rate Predictions for Next 5 Years
- Mortgage Rate Predictions for 2025: Expert Forecast
- Mortgage Rate Predictions: Why 2% and 3% Rates are Out of Reach
- How Lower Mortgage Rates Can Save You Thousands?
- How to Get a Low Mortgage Interest Rate?
- Will Mortgage Rates Ever Be 4% Again?