Since late 2022, mortgage rates have jumped to between 6% and 7% — and in fall 2023, they nearly eclipsed 8%, marking the highest 30-year mortgage rate seen in over two decades. Rates started to drop this summer in anticipation of the Federal Reserve cutting the federal funds rate by 25 basis points at its Sept. 18 meeting.
The Fed did indeed announce a rate decrease at the September meeting, but the slash was more significant than originally expected — 50 basis points instead of 25. The central bank also predicts two more rate cuts in 2024 and four in 2025.
So, what does this announcement mean? Will mortgage rates keep going down? Although rates are lower than a couple of months ago, they’re still well above the all-time lows we saw at the peak of the COVID-19 pandemic. When will mortgage rates go down more drastically and make monthly payments more affordable?
Dig deeper: When will the housing market crash again?
In this article:
Are mortgage rates already decreasing?
Yes and no. Let’s start with the good news.
Yes, mortgage rates have decreased significantly since the beginning of August 2024. The national average 30-year rate started August at 6.73%, and the 15-year fixed rate was 5.99%. Both rates have dropped by well over 50 basis points since then.
Now for the bad news: No, mortgage rates have not been decreasing since late September. They’ve remained stagnant and even inched up in some instances.
Basically, shorter-term rate shifts have been unremarkable, but the…
