One of the few silver linings for real estate in the middle of this devastating coronavirus pandemic has been record-low mortgage interest rates. And housing experts predict those ultralow rates will likely fall even further—venturing into the unprecedented 2% range.
That could give the flagging housing market—deeply hampered by state and local lockdowns, uncertainty about COVID-19, and a sputtering economy—a much needed boost. Lower rates equate to lower monthly housing mortgage payments, meaning many buyers will suddenly be able to afford homes with higher price tags.
“We expect mortgage rates to stay low and possibly slip lower,” says realtor.com Chief Economist Danielle Hale. “We’ll flirt with the 3% threshold for a while before we go below it.”
Although some lenders are offering rates in the high 2% range, rates averaged 3.28% for 30-year fixed-rate loans for the week ending May 14, according to the most recent Freddie Mac data