Mortgage rates have taken would-be buyers on a ride this year — and it’s only March. Generally, home buyers can anticipate mortgage rates to move down through the rest of this year as the banking crisis drags on, which could cool down inflation, Anna Bahney reported for CNN.
Photo Insert: Mortgage rates are indirectly impacted by actions that the Fed takes or is expected to take, as well as the health of the broader financial system and any uncertainty that may be percolating.
After steadily rising last year as a result of the Federal Reserve’s historic campaign to rein in inflation, the average rate for a 30-year fixed-rate mortgage topped out at 7.08% in November, according to Freddie Mac.
Then, with economic data suggesting inflation was retreating, the average rate drifted down through January. But a raft of robust economic reports in February brought concerns that inflation was not cooling as quickly or as much as many had hoped.
As a result, after falling to 6.09%, average mortgage rates climbed back up, rising half a percentage point over the month.
Then in March banks began collapsing. Thus, rates started falling again.
Neither the actions of the Federal Reserve nor the bank failures directly impact mortgage rates. But rates are indirectly impacted by actions that the Fed takes or is expected to take, as well as the health of the broader financial system and any uncertainty that may be percolating.