Mortgage costs will likely continue to be high in 2025, with 30-year fixed rates remaining above 6% due to lingering inflation concerns. The Federal Reserve has been cutting interest rates, but mortgage rates haven’t budged. Instead, they’re tied to 10-year Treasury bond yields, which investors are demanding higher returns on to offset risks.
President-elect Donald Trump’s proposed tariffs will also fuel inflation, making it harder for lenders to lower mortgage rates. Financial analysts expect the benchmark interest rate to drop by another 50 basis points, but this may not be enough to significantly reduce borrowing costs.
Leading forecasts predict 30-year fixed mortgage rates will range from 6.2% to 6.6%. These projections include:
– Mortgage Bankers Association: 6.4% – 6.6%
– Realtor.com: 6.2%
– Fannie Mae: 6.4%
– Wells Fargo: 6.3%
– Goldman Sachs: Above 6%
As the economy remains strong and inflation concerns persist, mortgage rates are likely to stay high in 2025, making it challenging for buyers to find affordable home financing options.
Source: https://www.cnbc.com/2024/12/30/why-mortgage-rates-remain-so-highand-what-to-expect-in-2025.html