The 30-year fixed-rate mortgage reversed course this week and decreased to an average of 3.89%, Freddie Mac reports. However, with expectations of even higher inflation on the horizon, mortgage rates likely will resume their upward trek over the coming weeks, Nadia Evangelou, senior economist and director of forecasting at the National Association of REALTORS®, notes on the association’s blog.
Despite this week’s decline, mortgage rates have risen by more than a full percentage point over the last six months, says Sam Khater, Freddie Mac’s chief economist. “Overall economic growth remains strong, but rising inflation is already impacting consumer sentiment, which has markedly declined in recent months,” Khater says. “As we enter the spring homebuying season with higher mortgage rates and continued low inventory, we expect home price growth to remain firm before cooling off later this year.”
Freddie Mac reports the following national averages with mortgage rates for the week ending Feb. 24:
- 30-year fixed-rate mortgages: averaged 3.89%, with an average 0.8 point, dropping from last week’s 3.92% average. Last year at this time, 30-year rates averaged 2.97%.
- 15-year fixed-rate mortgages: averaged 3.14%, with an average 0.7 point, dropping slightly from last week’s 3.15% average. A year ago, rates averaged 2.34%.
- 5-year hybrid adjustable-rate mortgages: averaged 2.98%, with an average 0.3 point, unchanged from last week. A year ago, 5-year ARMs averaged 2.99%.
Freddie Mac reports average commitment rates along with average points to better reflect the total upfront costs of obtaining the mortgage.