Mortgage Interest Rate Prediction for 2018. Freddie Mac predicts the increase in short-term rates will have a strong, negative impact on long-term rates, with 30 year fixed rates increasing to 4.9% 30 year fixed rates by 4th quarter 2018.
Forecasters expect mortgage rates to rise again in 2019 – but at a slower pace. Freddie Mac expects the 30-year fixed mortgage rate to rise half a percentage point in 2019, and the National Association of Realtors predicts a rise of 0.4 percentage point. Fannie Mae’s forecast is for an increase of just 0.1 percentage point.
Freddie Mac’s forecast has a slightly more doom and gloom outlook for mortgage rates by year end 2018. They predict the robust economy will produce a significant rise in inflation that will be met by 3 or 4 rate increases by the Federal Reserve throughout the year.
Freddie Mac expects the 30-year fixed mortgage rate to rise half a percentage point in 2019, and the National Association of Realtors predicts a rise of 0.4 percentage point.
However, in today’s environment of rising rates and rising home prices, affordability suffers as well. Should rates rise by as much as 0.5 percent and house prices rise 5 percent (prices rose about 5.8 percent in 2017), a borrower’s monthly principal and interest payment will be more than 10 percent higher than it was before the increases.
(Source: Urban Institute, Freddie Mac, Federal Reserve) In June, the Fed voted to raise interest rates for the second time this year. The first rate hike occurred in its March meeting , just after deciding to raise rates three months before in December 2016 .
The value of real estate will continue to rise. Freddie Mac predicts housing prices will increase by 4.3 percent in 2019. 1 While the rapid price appreciation we witnessed earlier in the decade has slowed, the combination of a strong economy, low unemployment, and a lack of inventory in many market segments continues to push prices higher.
A lot of attention has been paid to the fact that mortgage rates are expected to rise throughout 2014. As mortgage rates creep upward in this year, borrowers need remember that rates will still be historically low and nowhere near the interest rates consumers faced in the early 1980s.
At NerdWallet. to Freddie Mac. But the sun appears to be setting on the sub-4% mortgage rate. Logan Pichel, head of consumer lending for Regions Bank, believes that as rates rise, more people may.