With the outlook for mortgage rates finally improving, the forecast for housing is looking better heading into the New Year.
Realtor.com economists predict that mortgage rates, which have declined over the past five weeks, will slide into the 6% territory in 2024. Fannie Mae expects mortgage rates to decline gradually over the next two years, reaching 6.9% for the 30-year mortgage by 2025. At the same time, First American economists noted that mortgage rates will hover in the 6.5% to 7.5% range.
That's good news for the market that recently saw mortgage rates climb close to 8%, but the dip won't be enough to entice existing homeowners with sub-5% mortgages back into the fray. This will continue to complicate supply availability and will remain a challenge as the market heads into the New Year, according to Realtor.com Chief Economist Danielle Hale.