Big Question: Will Mortgage Rates Remain Low Next Year?

Dated: November 23 2020

Views: 1406

Will Mortgage Rates Remain Low Next Year?

Will Mortgage Rates Remain Low Next Year? | MyKCM

In 2020, buyers got a big boost in the housing market as mortgage rates dropped throughout the year. According to Freddie Mac, rates hit all-time lows 12 times this year, dipping below 3% for the first time ever while making buying a home more and more attractive as the year progressed (See graph below):Will Mortgage Rates Remain Low Next Year? | MyKCMWhen you continually hear how rates are hitting record lows, you may be wondering: Are they going to keep falling? Should I wait until they get even lower?

The Challenge with Waiting

The challenge with waiting is that you can easily miss this optimal window of time and then end up paying more in the long run. Last week, mortgage rates ticked up slightly. Sam Khater, Chief Economist at Freddie Mac, explains:

Mortgage rates jumped this week as a result of positive news about a COVID-19 vaccine. Despite this rise, mortgage rates remain about a percentage point below a year ago.”

While rates are still lower today than they were one year ago, as the economy continues to get stronger and the pandemic is resolved, there’s a very good chance interest rates will rise again. Several top institutions in the real estate industry are projecting an increase in mortgage rates over the next four quarters (See chart below):Will Mortgage Rates Remain Low Next Year? | MyKCMIf you’re planning to wait until next year or later, Mike Fratantoni, Chief Economist at the Mortgage Bankers Association (MBA), forecasts mortgage rates will begin to steadily rise:Will Mortgage Rates Remain Low Next Year? | MyKCMAs a buyer, you need to decide if waiting makes financial sense for you.

Bottom Line

If you’re planning to buy a home and want to take advantage of today’s low rates, now is the time to do so. Don’t assume they’re going to stay this low forever.

Blog author image

Derek Brandenburg

The founder of the Brandenburg Crew Inc., Derek, was raised with the notion that hard work was a way of life. Growing up on a farm, most days started at 6am, and ended at 11pm. This work ethic followe....

Latest Blog Posts

Big Question: Will Mortgage Rates Remain Low Next Year?

Will Mortgage Rates Remain Low Next Year?In 2020, buyers got a big boost in the housing market as mortgage rates dropped throughout the year. According to Freddie Mac, rates hit all-time lows

Read More

Why the Cost of a Home Is Far More Important than the Price

The Cost of a Home Is Far More Important than the PriceHousing inventory is at an all-time low. There are 39% fewer homes for sale today than at this time last year, and buyer demand

Read More

Selling this Fall May Be Your Best Move - Here's Why

If you’re thinking about moving, selling your house this fall might be the way to go. Here are four highlights in the housing market that may make your decision to sell this fall an easy one.

Read More

New Listing in DL! 21522 NE Pickerel Lake Road

You don't need to look anymore, THIS is your next lake home. Situated in the pines of Pickerel Lake, just north of Detroit Lakes, is this beautiful home that offers stunning views off of two large

Read More