For nearly a year, mortgage rates have remained near historic lows. The 30-year fixed-rate mortgage fell this week to average 2.77%, Freddie Mac reported. Its lowest average on record was 2.65%, recorded earlier this January.
“We’re now seeing rates fluctuate a bit as political and economic factors drive Treasury yields higher,” says Sam Khater, Freddie Mac’s chief economist. “However, we forecast rates to remain relatively low this year as the Federal Reserve keeps interest rates anchored near zero for a longer period of time if needed until the economy rebounds.”
The National Association of REALTORS® predicts mortgage rates to rise only slightly over the course of the next few weeks, forecasting the 30-year fixed-rate mortgage to average 3% for the first half of this year.
Freddie Mac reports the following national averages with mortgage rates for the week ending Jan. 21:
- 30-year fixed-rate mortgages: averaged 2.77%, with an average 0.7 point, falling from last week’s 2.79% average. Last year at this time, 30-year rates averaged 3.60%.
- 15-year fixed-rate mortgages: averaged 2.21%, with an average 0.6 point, falling from last week’s 2.23% average. A year ago, 15-year rates averaged 3.04%.
- 5-year hybrid adjustable-rate mortgages: averaged 2.80%, with an average 0.4 point, dropping from last week’s 3.12% average. A year ago, 5-year ARMs averaged 3.28%.
Freddie Mac reports average points along with average commitment rates to better reflect the total upfront cost of obtaining a mortgage.
Source: “Instant Reaction: Mortgage Rates, January 21, 2021,” National Association of REALTORS® and Freddie Mac