Where Could Mortgage Rates Go in the Next 6 Months?

Mortgage rates are primarily influenced by the 10-year Treasury yield, which is, in turn, impacted by the Federal Reserve's decisions. With the recent .25% rate cut on November 7th, the market had already anticipated this move. While no one can predict exactly where rates will go, here’s what we do know:

Fed Plans

• The Fed has signaled they plan to cut the Fed rate again in December.
• Additionally, they have indicated plans to reduce rates by another 1% (100 basis points) total in 2025.

Effect on the Real Estate Market

• Home Prices - With these signs, home prices are expected to remain strong, with projections showing 5% appreciation across the U.S. next year.
• Buyer Environment - As mortgage rates are likely to decrease in 2025, we expect more buyers to enter the market. According to the National Association of Realtors, for every 1% drop in mortgage rates, about 5 million more eligible buyers will be added.
• Why Buy Now? Buying a home now could give you an edge in terms of home appreciation and avoid the increased buyer competition that may come with lower rates in the future.
• Refinancing Opportunity - If you currently have a mortgage rate of 6% or higher, it may be time to evaluate your options. With rates fluctuating, it’s a good idea to start planning with me so we are ready to lock in a better rate when the time is right.

The market is in flux, but there are plenty of opportunities on the horizon for both buyers and homeowners looking to refinance.

Let me know if you’d like to discuss how these changes could impact your situation! Simply contact me via the contact us or schedule an appointment links or text/call 360-801-5870.