As we stand on the brink of a new year, experts in the field are making bold predictions about the direction of mortgage rates in the upcoming week. The data gathered from various sources provides valuable insights into the factors influencing these forecasts. Majority Anticipates a Drop in Mortgage Rates.
What Are the Mortgage Rate Predictions for Next Week?
Experts in the field have weighed in on the future of mortgage rates for the week of Feb. 1-7, 2024. According to the latest expert poll conducted by Bankrate:
- Will Go up: 0%
- Will Stay the same: 14%
- Will Go down: 86%
Coming out of the most recent Federal Reserve meeting, there is an optimistic outlook for mortgage rates for the coming weeks. A significant 86% of experts polled by Bankrate anticipate a fall in rates for the upcoming week. Only 14% expect rates to stay unchanged, with a negligible 0% predicting a rise.
The average 30-year fixed rate, as of Jan. 31, has fallen to 6.84%, a decline from 6.93% on Jan. 24.
Easing inflation pressures are identified as a key factor influencing the current mortgage rate scenario. Greg McBride, Chief Financial Analyst at Bankrate, emphasizes that this will contribute to lower mortgage rates without delay.
Mortgage Rates Insights from Industry Experts
- Heather Devoto, Vice President, Branch Manager, First Home Mortgage, McLean, VA: “I expect rates to move lower in the week ahead as economists get additional insight into the pace of growth in the economy.”
- Ken H. Johnson, Real Estate Economist, Florida Atlantic University: “Lower borrowing needs by the federal government for Q1 2024 will lower the yield on 10-year Treasurys, leading to slightly lower long-term mortgage rates next week.”
- Dick Lepre, Loan Agent, CrossCountry Mortgage, Alamo, CA: “If the Fed acknowledges a path of lower overnight rates, we should see lower mortgage rates.”
- Greg McBride, CFA, Chief Financial Analyst, Bankrate.com: “Easing inflation pressures will help mortgage rates now, no waiting.”
- Les Parker, CMB, Managing Director, Transformational Mortgage Solutions, Jacksonville, Florida: “Expect lower mortgage rates driven by slowing global growth and inflation.”
- Michael Becker, Branch Manager, Sierra Pacific Mortgage, White Marsh, Maryland: “Rates will hold in their current range for the coming week.”
Conclusion: What to Anticipate in Mortgage Rates
As the experts weigh in, the consensus is clear: a majority predicts a decline in mortgage rates for the upcoming week. Factors such as easing inflation pressures and government borrowing needs play a pivotal role in shaping this trend. While uncertainties exist, the overall sentiment points towards lower mortgage rates in the near future.
Mortgage Rate Predictions for the Next Month (February 2024)
Mortgage Rate Forecast for Next Week (Feb. 5-9)
Mortgage rates continued the back-and-forth affair and went back down after growing the week prior. The average 30-year fixed rate mortgage (FRM) decreased from 6.69% on Jan. 25 to 6.63% on Feb. 1, according to Freddie Mac. “Mortgage rates have been stable for nearly two months, but with continued deceleration in inflation, we expect rates to decline further.
The economy continues to outperform due to solid job and income growth, while household formation is increasing at rates above pre-pandemic levels. These favorable factors should provide strong fundamental support to the market in the months ahead,” said Sam Khater, Freddie Mac’s Chief Economist.
Will Mortgage Rates Go Down?
Mortgage rates fluctuated significantly in 2023, with the average 30-year fixed rate going as low as 6.09% on Feb. 2 and as high as 7.79% on Oct. 26, according to Freddie Mac. The range can be largely attributed to the Federal Reserve’s ongoing fight against inflation, juxtaposed with uncertainty in the banking sector sparked by Silicon Valley Bank’s collapse.
However, with duress permeating the financial market and the fallout from U.S. debt ceiling talks, the Fed may continue making hikes to bring interest rates down. With the economy likely heading into a recession, it’s possible we’ve already seen the peak of this rate cycle. Of course, interest rates are notoriously volatile and could tick back up on any given week.
Expert Rate Predictions
- Craig Berry, Acopia Home Loans: Rates will fall. “Mortgage rates strolled into 2024 with a surprisingly nice winning streak for eight straight weeks. As inflation continues to improve, along with the projected rate cuts, mortgage rates will continue to see a gradual decline through the month of February.”
- Ralph DiBugnara, Home Qualified: Rates will rise. “The first quarter of 2024 will look like most of the average interest rates we saw in the last quarter of 2023.”
- Hannah Jones, Realtor.com: Rates will fall. “In the December FOMC meeting, the Fed chose to keep the policy rate steady and signaled that they may even cut rates in 2024.”
- Odeta Kushi, First American: Rates will moderate. “The Federal Reserve is expected to hold rates steady at its January meeting.”
- Victor Kuznetsov, Imperial Fund: Rates will fall. “We are anticipating a declining interest rate environment throughout 2024.”
- Rick Sharga, CJ Patrick Company: Rates will fall. “Mortgage rates fell more rapidly than most industry analysts anticipated after the Fed scaled back its hawkish stance at its last meeting.”
Mortgage Interest Rates Forecast Next 90 Days
As inflation ran rampant in 2022, the Federal Reserve took action to bring it down, leading to the average 30-year fixed-rate mortgage spiking in 2023. With inflation gradually cooling, the Fed adjusted its policies with skipped hikes and cuts expected this year. Additionally, the economy showing signs of slowing has many experts believing mortgage interest rates will gradually descend in 2024. Of course, rates could rise on any given week or if another global event causes widespread uncertainty in the economy.
Mortgage Rate Predictions for 2024
If inflation continues to dissipate and the economy cools or goes into a recession, it's likely mortgage rates will decrease in 2024. Although, it's important to remember that interest rates are notoriously volatile and are driven by various economic factors.
Housing Authority | 30-Year Mortgage Rate Forecast (Q1 2024) |
---|---|
National Association of Home Builders | 6.77% |
Wells Fargo | 6.85% |
Fannie Mae | 7.00% |
Mortgage Bankers Association | 7.00% |
National Association of Realtors | 7.50% |
Average Prediction | 7.02% |
Current Mortgage Interest Rate Trends
Mortgage rates decreased following a jump the prior week. The average 30-year fixed rate declined from 6.69% on Jan. 25 to 6.63% on Feb.1. The average 15-year fixed mortgage rate similarly fell, going from 5.96% to 5.94%.
Month | Average 30-Year Fixed Rate |
---|---|
January 2023 | 6.27% |
January 2024 | 6.64% |
As experts provide varying predictions, it remains to be seen whether mortgage rates will indeed go down in February 2024. The intricate interplay of economic factors, inflation rates, and global events makes forecasting interest rates a challenging task. Homebuyers and refinancers are advised to stay informed, shop around for the best rates, and consider their unique financial situations before making mortgage-related decisions.
Sources:
- https://www.bankrate.com/mortgages/rate-trends/
- https://themortgagereports.com/32667/mortgage-rates-forecast-fha-va-usda-conventional
- http://www.freddiemac.com/research/datasets/refinance-stats/index.page
- https://www.blackknightinc.com/category/press-releases
- https://www.federalreserve.gov/monetarypolicy/fomccalendars.htm