Here are the mortgage interest rate forecasts for fall 2024.

Over the past two years, Americans have been dealing with persistent inflation in the U.S. economy. In an attempt to control inflation, the Federal Reserve has raised its benchmark interest rate several times—and it now remains near 0.5%. Highest level in 23 yearsAs a result, interest rates on many consumer loans, including mortgages, have risen, making it too expensive for many people to buy a home.

While mortgage rates remain relatively high – Average 30 Year Mortgage Rate Today As of August 19, 2024, inflation stood at 6.57%, well above the pandemic-era lows of less than 3%, Mortgage rates are starting to fall. Interest rates have fallen slightly in recent months. The Federal Reserve may soon cut rates, which could push mortgage rates down even further.

However, in today’s unusual economic environment, there are other factors that can also affect mortgage rates, such as the health of the economy. Bad news for the economy can be good news for mortgage rates, says Melissa Cohn, regional vice president at William Ravis Mortgage. With that in mind, where are mortgage rates headed this fall? We asked a few experts to give us their predictions.

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What are the mortgage interest rate forecasts for fall 2024?

Here’s what some experts think could happen. Mortgage Rates This fall:

Mortgage rates will gradually decline.

Many of the experts we interviewed believe that mortgage rates will gradually decline this fall. With the Federal Reserve expected to cut interest rates for the first time at its September meeting, some believe that event may already be priced in.

“If economic data continues to show a slowing economy and inflation is under control, most economists expect the Fed to begin a series of rate cuts, which would cause mortgage rates to gradually decline,” says Rob Cook, vice president of Discover Home Loans.

Cook says that if the Fed does take action to cut interest rates in September, it would likely have a positive impact on mortgage rates. However, he says, rates are not expected to fall that much because the market has already assumed that the Fed will do so, which has led to a slight decline in mortgage rates recently.

Jeff Tucker, chief economist at Windermere Real Estate, has similar thoughts.

“No one has a crystal ball to predict where mortgage rates will move, but I think rates will continue to decline modestly, in a two-step-down, one-step-up pattern, thanks to slowing inflation and a weak labor market,” Tucker says.

According to Tucker, these trends and the expected start of the Fed’s rate cuts are well known. So they’ve already been priced in to some extent — which is why interest rates have been cut by about half a percentage point in the past two months, Tucker says.

Cohen also believes mortgage rates will fall this fall.

“I think the overall trend in mortgage rates will be down as we head into the fall,” Cohn says. She believes this because economic data has shown that Inflation continues to slow It is approaching the Federal Reserve’s target interest rate of 2%.

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How low could prices go this fall?

If you are planning to buy a home soon, you may just be wondering How Interest Rates Could Fall in the Fall If the Fed Cuts RatesTucker says he doesn’t know for sure, but he thinks we could see mortgage rates between 6% and 6.5% this fall. “Below 6% seems like a slim possibility, and if I had to be more specific, I think 6.25% is a reasonable possibility,” Tucker says.

Is now a good time to buy a home?

Whether buying a home now or waiting for prices to drop is a smart move depends on your unique financial situation. Before taking out a mortgage, review your budget to determine how much you can afford to buy a home.

“The decision to wait (or not) for home loan rates to fall depends largely on the individual situation of consumers,” Cook says.

However, there are benefits to Fixed mortgage interest rate Now if you are financially prepared to buy a home. For example, locking in a fixed mortgage rate now protects you from future price increases. Cohn believes that if you lock in a rate now, you may have less competition in the future.

“As prices come down, more buyers will come into the market, and prices will go up,” says Cohn. In turn, she believes buyers will be much better off if they pay less for a home and then Refinancing When prices reach their lowest levels in the future.

Conclusion

Mortgage rates appear to be headed lower this fall, according to experts, but no one knows how far they might go. As a result, many experts believe you should focus more on your budget and take steps to prepare for homeownership no matter what happens with mortgage rates.

“patriotic [mortgage rate] “Trends can be helpful for knowing whether the tide is coming in or out, but a knowledgeable local real estate agent is indispensable when it comes to navigating the ins and outs of the local market and finding the best deal on the perfect home,” says Tucker.

If you decide to buy a home now and Mortgage interest rates fall After you buy, Cohen says to remember that you can always refinance.