| September 23, 2024 |
According to Freddie Mac’s PMMS report, the 30-year fixed-rate mortgage rates dropped to 6.09% in the week ending on September 18. It was 6.20% last week, before the Fed rate cut was announced.
The 15-year FRM dropped to 5.15%, down from last week’s 5.27%. Declining mortgage rates have sparked a surge in mortgage and refinance applications. If the trend continues, homes may become more affordable by the end of the year.
Mortgage Rates Respond to Federal Open Market Committee Rate Cuts
Mortgage rates have been dropping steadily in recent weeks in anticipation of the Fed rate cut. Chairman Jerome Powell made it clear that the Fed’s fight with inflation is nearing its end.
While FOMC’s decisions don’t always directly influence mortgage rates, significant changes can have an impact.
The September rate cut is the first since March 2020. Freddie Mac’s chief economist, Sam Khater, mentioned the rate cut was almost ‘baked in.’ That’s clear from the downward trend in mortgage rates.
30-year FRM was at 7.19% same time last year and the 15-year FRM was at 6.54%. Experts like Khater and Realtor.com’s Senior Economist, Ralph McLaughlin, predict mortgage rates may decline further. However, McLaughlin also predicts that rates will settle to somewhere between 6% to 6.2% this year.