Mortgage rate predictions are changing: Here’s what Fannie Mae expects
Mortgage rate predictions are shifting as Fannie Mae sharply raises its mortgage rate forecast for 2027. Meanwhile, residential lending has fallen for 11 of 12 quarters after reaching a peak following the COVID-19 lockdowns. Data from Attom's 2024 U.S. Residential Property Mortgage Origination Report showed loan volumes dropped 4.8 percent year over year in the first quarter of 2024, marking a 69.3 percent decline from the 2021 peak. During that same first quarter, there were 565,000 purchase loans and 491,000 refinances recorded.
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- ✓ Fannie Mae sharply raised its mortgage rate forecast for 2027.
- ✓ Residential lending fell for 11 of 12 quarters after reaching a peak during the refinance boom following COVID-19 lockdowns.
- ✓ Attom data's 2024 U.S. Residential Property Mortgage Origination Report showed loan volumes fell 4.8% year over year in the first quarter of 2024.
- ✓ Loan volumes in the first quarter of 2024 marked a 69.3% fall from the 2021 peak.
What changed
Fannie Mae sharply raised its mortgage rate forecast for 2027.
Live updates
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Fannie Mae Sharply Raises Mortgage Rate Forecast
Mortgage rate predictions are shifting as Fannie Mae sharply raises its mortgage rate forecast for 2027. Meanwhile, residential lending has fallen for 11 of 12 quarters after reaching a peak following the COVID-19 lockdowns. Data from Attom's 2024 U.S. Residential Property Mortgage Origination Report showed loan volumes dropped 4.8 percent year over year in the first quarter of 2024, marking a 69.3 percent decline from the 2021 peak. During that same first quarter, there were 565,000 purchase loans and 491,000 refinances recorded.
Why it matters
Mortgage markets grew explosively after COVID-19 lockdowns when the Federal Reserve pinned interest rates at zero, engaged in quantitative easing, and purchased over a trillion dollars in mortgage-backed securities. This monetary policy fueled rapid home price growth before the Federal Reserve quickly normalized interest rates, freezing housing markets. Higher borrowing costs continue to squeeze buyers, leading builders to offer incentives.
What is confirmed
- Fannie Mae sharply raised its mortgage rate forecast for 2027.
- Residential lending fell for 11 of 12 quarters after reaching a peak during the refinance boom following COVID-19 lockdowns.
- Attom data's 2024 U.S. Residential Property Mortgage Origination Report showed loan volumes fell 4.8% year over year in the first quarter of 2024.
- Loan volumes in the first quarter of 2024 marked a 69.3% fall from the 2021 peak.
- There were 565,000 purchase loans and 491,000 refinances in the first quarter of 2024.
Still unconfirmed
- Zillow lender marketplace rates indicate that 30-year and 15-year fixed mortgage rates are significantly lower than they were the previous week.
What to watch next
- Future updates to Fannie Mae housing forecasts
- Changes in Federal Reserve interest rate policy
confidence 90%Sources used for this update (14)
- finance.yahoo.com — Yahoo Finance - Stock Market Live, Quotes, Business & Finance News
- www.bankrate.com — Current Mortgage Rates: Compare Today's Rates | Bankrate
- www.mortgagecalculator.org — Mortgage Calculator
- www.bankrate.com — Mortgage calculator - Bankrate
- www.fidelity.com — What is a mortgage and how does it work? | Fidelity
- www.bankofamerica.com — Mortgages - Home Mortgage Loans from Bank of America
- www.freedommortgage.com — Freedom Mortgage | A Top Mortgage Lender and Servicer
- www.wellsfargo.com — Mortgages | Home Mortgage Loans | Wells Fargo
- CNBC — Fannie Mae sharply raises mortgage rate forecast for 2027
- TheStreet — Mortgage rate predictions are changing: Here’s what Fannie Mae expects
- The New York Times — Homeownership Drifts Further Out of Reach as Rates Rise
- KUTV — Higher mortgage rates squeeze Utah buyers as builders offer incentives
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