Mortgage rates are expected to decline when the Federal Open Market Committee cuts the benchmark interest rate, which is likely to happen in the second half of 2024. But as long as inflation runs hotter than the Fed would like, rates will remain elevated at their current levels.
“Strong incoming economic and inflation data has caused the market to re-evaluate the path of monetary policy, leading to higher mortgage rates,” says Sam Khater, Freddie Mac’s chief economist, in a Feb. 22 statement.
Most economists agree that rates should pull back gradually to the mid-6% range by year-end. Here’s what experts have to say about their predictions for this year.
• Fannie Mae: Rates Will Decline to 6.4%
The April Housing Forecast from Fannie Mae puts the average 30-year fixed rate at 6.7% during the first quarter of 2024, falling to 6.4% by year-end. This reflects an upward revision in Fannie’s analysis: Two months ago, the mortgage giant expected rates would dip below 6% at the end of this year. All…
