How Upset Should You Be about 3% Mortgage Rates?.

Dated: March 10 2021

Views: 64

How Upset Should You Be about 3% Mortgage Rates? | MyKCM

Last Thursday, Freddie Mac announced that their 30-year fixed mortgage rate was over 3% (3.02%) for the first time since last July. That news dominated real estate headlines that day and the next. Articles talked about the “negative impact” it may have on the housing market. However, we should realize two things:

1. The bump-up in rate should not have surprised anyone. Many had already projected that rates would rise slightly as we proceeded through the year.

2. Freddie Mac’s comments about the rate increase were not alarming:

“The rise in mortgage rates over the next couple of months is likely to be more muted in comparison to the last few weeks, and we expect a strong spring sales season.”

A “muted” rise in rates will not sink the real estate market, and most experts agree that it will be a strong spring sales season.”

What does this mean for you?

Obviously, any buyer would rather mortgage rates not rise at all, as any upward movement increases their monthly mortgage payment. However, let’s put a 3.02% rate into perspective. Here are the Freddie Mac annual mortgage rates for the last five years:

  • 2016: 3.65%
  • 2017: 3.99%
  • 2018: 4.54%
  • 2019: 3.94%
  • 2020: 3.11%

Though 3.02% is not as great as the sub-3% rates we saw over the previous seven weeks, it’s still very close to the all-time low (2.66% in December 2020).

And, if we expand our look at mortgage rates to consider the last 50 years, we can see that today’s rate is truly outstanding. Here are the rates over the last five decades:

  • 1970s: 8.86%
  • 1980s: 12.7%
  • 1990s: 8.12%
  • 2000s: 6.29%
  • 2010s: 4.09%

Being upset that you missed the “best mortgage rate ever” is understandable. However, don’t throw the baby out with the bathwater. Buying now still makes more sense than waiting, especially if rates continue to bump up this year.

Bottom Line

It’s true that you may not get the same rate you would have five weeks ago. However, you will get a better rate than what was possible at almost any other point in history. Let’s connect today so you can lock in a great rate while they stay this low.

Blog author image

Tony and Elsa Fuentes

A home is not a home because of its room dimensions or the color of the walls. It is about how you feel when you walk through the front door. And the way you can instantly envision your life unfolding....

Latest Blog Posts

Fact v Fiction: A Real Estate Professional Can Help You

A Real Estate Professional Helps You Separate Fact from FictionIf you’re following the news, chances are you’ve seen or heard some headlines about the housing market that don’t

Read More

Leta Buy a Home! Now May Be the Time.

Want To Buy a Home? Now May Be the Time.There are more homes for sale today than at any time last year. So, if you tried to buy a home last year and were outbid or out priced,

Read More

The Homeownership Rate Is Growing

The U.S. Homeownership Rate Is GrowingThe desire to own a home is still strong today. In fact, according to the Census, the U.S. homeownership rate is on the rise. To illustrate the

Read More

What Are Today’s First-Time Homebuyers Best Options?

What Are the Best Options for Today’s First-Time Homebuyers?If you’re looking to buy your first home, you’re likely balancing several factors. Because both mortgage rates 

Read More