Home Loan Rates Unexpectedly Dip Below 3%

“Mortgage rates continue to hover at around 3% again this week due to rising economic and financial market uncertainties,” says Sam Khater, Freddie Mac’s chief economist. “Unfortunately, with the expectation that both mortgage rates and home prices will continue to rise, competition remains high and housing affordability is declining.”

Still, Nadia Evangelou, NAR’s senior economist and director of forecasting, writes on the association’s blog that even if mortgage rates do climb to 3.5%, that is still a historical low. Demand for housing is expected to remain robust. NAR is forecasting about 6 million existing homes to be sold in 2022, about the same as last year.

Freddie Mac reports the following national averages with mortgage rates for the week ending Oct. 6:

*30-year fixed-rate mortgages: averaged 2.99%, with an average 0.7 point, falling from last week’s 3.01% average. Last year at this time, they averaged 2.87%.

*15-year fixed-rate mortgages: averaged 2.23%, with an average 0.7 point, dropping from last week’s 2.28% average. A year ago, they averaged 2.37%.

Source: Freddie Mac and “Instant Reaction: Mortgage Rates, October 7, 2021,” National Association of REALTORS® Economists’ Outlook blog (Oct. 7, 2021)