This drop in mortgage rates caused the Mortgage Banker’s Association January mortgage rate forecast to revise the 30-year fixed mortgage rate down from 5.1 percent to an average of 4.8 percent in 2019 — the same average for all of last year. The average rate is expected to stay below 5 percent through 2021.
As rates took a dip, house price appreciation is also expected to soften. According to the latest CoreLogic Home Price Insights Report, home prices jumped 5.1 percent between November 2017 and November 2018. By November of this year, that growth rate should slow to 4.8 percent.
Potential homebuyers who are crossing their fingers and waiting for home prices to fall further may miss the affordability boat if mortgage rates creep up again. A severe shortage in both new construction and existing housing stock means homebuyers won’t see much decline, if any, in home prices in the foreseeable future. Loan Depot