A lot of costs are rising in the construction industry. Lumber, building materials, roofing, transportation and now interest rates.
As the calendar flipped to 2021, it didn’t take long for the rise in mortgage rates. Just two weeks into the new year, Freddie Mac reported that mortgage rates climbed 14 basis points to 2.79%, a dramatic contrast to 2020, a year in which mortgage rates set record lows 16 times.
Economists across the housing industry believe the era of extreme low rates could be coming to a close, but the transition might be a slow burn.
Freddie Mac’s quarterly forecast estimates that the average 30-year fixed-rate mortgage will be 2.9% in 2021 and 3.2% in 2022. However, the factors that will drive mortgage rate movements are still up for debate.
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