Mortgage Rates are Rising…but Still Low Compared to Historic Highs
Mortgage rates are expected to continue to rise for the balance of 2022. While the Fed’s decision to raise rates is the primary driver, there are several other factors which are impacting interest rates. The slowly recovering economic environment, inflation, Covid, and now the situation in Ukraine are all contributing factors.
On Feb 21st, CNet stated that the average 30-year fixed mortgage rate has risen to 4.190%. With continued low inventory, and housing prices at all time highs, fewer borrowers will be able to qualify for a mortgage as the year progresses. For existing home owners, the refinancing rush of the past two years is over as most qualified borrowers refinanced to a rates as low as 2.5% and there is no advantage to refinancing in the foreseeable future.
Still, it is interesting to note that mortgage rates are historically low. In 1984, rates were as high as 14%. With any luck, rates won’t rise to levels that high again!