By U.S. mortgage rates witnessed a slight increase in the latest week but are anticipated to decrease throughout the rest of the year. As of January 4, the 30-year fixed-rate mortgage averaged at 6.62%, up by 1 basis point from the previous week. However, it is worth noting that a year ago, the 30-year mortgage was averaging at 6.48%.
Meanwhile, the average rate on the 15-year mortgage decreased to 5.89% from 5.93% the previous week. Comparatively, a year ago, the 15-year mortgage was at 5.73%.
Freddie Mac, a leading source of mortgage data, collects information from thousands of lenders across the country when applicants apply for a mortgage. According to their weekly report, the expectation of rate cuts this year from the Federal Reserve, coupled with declining inflationary pressures, will contribute to a continued downward drift in mortgage rates as the year progresses. Sam Khater, chief economist at Freddie Mac, stated, “While lower mortgage rates are welcome news, potential homebuyers are still dealing with the dual challenges of low inventory and high home prices that continue to rise.”
Lisa Sturtevant, chief economist at Bright MLS, added that although declining rates are beneficial for buyers, the scarcity of available properties due to insufficient new construction and existing homeowners staying in their current homes longer will continue to pose a challenge in 2024.
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