Sandy Herrick Answers – Will 2024 Mortgage Rates Fall?

Today, mortgage rates are still historically elevated. But they’ve dropped considerably since October, even dipping into 6% territory five times since Christmas. The current average is a bit higher than that, but still more than a full percentage point below the 8.45% peak of last fall.

KEY TAKEAWAYS

• The Federal Reserve Wednesday announced its fifth rate hold in a row, after hikes in 2022 and 2023 raised the federal funds rates to almost a 23-year high.
• The Fed’s rate moves do not directly drive mortgage rates. But they can trigger dominoes that impact the rates lenders are willing to offer.
• Inflation is one of the biggest drivers of mortgage rates, and it remains stubbornly above the Fed’s 2% target level.
• Mortgage rates surged to a 20-year high in October, but have since dropped more than a percentage point.
• The Fed said Wednesday it’s still watching and waiting for more good news on inflation and jobs before considering a rate cut. But it is forecasting three rate decreases by the end of 2024.