Mortgage rates fell for the fourth-straight week, hitting 3.79 percent for a 30-year, fixed-rate loan. A week ago, rates averaged 3.81 percent, according to Freddie Mac. We haven’t seen 4 percent or higher since, well, 2015.
Our run of low rates has been incredible, especially when you look at the big picture.
Let’s zoom in on that chart. Everyone was worried last year when the Fed was preparing to raise interest rates on overnight loans made to banks. The central bank doesn’t set mortgage rates, but its actions typically have a ripple effect.
Chair Janet Yellen and her team finally pulled the trigger Dec. 16, raising short-term rates for the first time since 2006. Some people (not us) said the move might hurt homebuyers and the housing market. They were wrong. Take a look.
Yesterday, Yellen & Co. met again. They voted unanimously not to raise rates and expressed worry about low oil prices, China’s slowdown and uneasy global financial markets. In the big economic picture, housing has been a bright spot.
Mortgages eventually will get more expensive, which might tap the brakes on home prices in a good way. We expect home prices to rise between 3.5 percent and 4.5 percent, down from almost 6 percent in 2015.
