The housing market continues to be a topic of keen interest and speculation this year, especially regarding mortgage rates. The journey through 2023 was anything but predictable, with rates reaching unexpected peaks and then making surprising adjustments. For those considering buying or selling a home in 2024, understanding the current mortgage landscape is crucial. InterBank’s home loan department is here to provide insights and guidance to help you navigate these changes effectively.
When Will Mortgage Rates Go Down?
Despite economists’ initial predictions of a decline in mortgage rates throughout 2023, the reality was quite the opposite. Rates surged to a new peak of 7.79% by late October, as reported by Freddie Mac. However, by the end of the year, rates took an unexpected turn, dropping to around 6.6%. This volatility serves as a reminder of the inherent unpredictability in forecasting mortgage rates, underscoring Fed Chair Jerome Powell’s remark that “Forecasts are highly uncertain.”
What to Expect in 2024
Looking ahead, there’s a general consensus among economists that we might see a decline in mortgage rates, potentially reaching around 6% by the end of 2024. This anticipated decrease stems from several factors, including the Federal Reserve’s shift in monetary policy. After a series of rate hikes in the preceding years, the Fed’s decision to hold rates steady and the expectation of rate cuts in 2024 suggest a possible easing of mortgage rates.
Why Mortgage Rates Are Expected to Decline
The persistence of high mortgage rates in 2023 can be attributed to the Federal Reserve’s efforts to combat inflation. However, signs of a cooling economy have emerged, prompting the Fed to adopt a more cautious stance. This shift, along with adjustments in the spread between mortgage rates and Treasury yields, hints at a potential decrease in mortgage rates, offering some relief to prospective homebuyers.
Advice for Buying or Selling a Home in 2024
For those looking to enter the housing market, the expected dip in mortgage rates presents both opportunities and challenges. Buyers may find some relief in terms of affordability, but should not expect a significant drop in home prices. The market is likely to stabilize, offering a more balanced environment for both buyers and sellers. Sellers, on the other hand, must consider their next steps carefully, especially if they plan to purchase another home, as they will also be subject to the current rate and price landscape.
Mortgage Refinancing in 2024
While the forecast suggests a decline in mortgage rates, refinancing may not be a viable option for all homeowners, particularly those who secured lower rates in the past. However, for recent homebuyers or those with specific financial goals, refinancing could still offer benefits, such as shorter repayment terms or access to home equity.
Partner with InterBank for Your Mortgage Needs
As we navigate the complexities of the 2024 housing market, choosing a trusted local partner like InterBank can make all the difference. Our experienced loan officers are dedicated to providing personalized service and expert advice, ensuring you make the most informed decisions for your homebuying or selling journey. With InterBank, you can confidently lock in your rate and maximize the opportunities presented by the current market conditions. Let us help you achieve your housing goals in 2024 and beyond.
Equal Housing Lender | NMLS# 412789