2024 was a disappointing year for those looking forward to a Fed rate-cut cycle and what that could do to mortgage rates. A strong economy (and a skittish Fed) pushed rate cuts all the way to September — and then mortgage rates went higher!
However, the bond market got ahead of the Federal Reserve and before the first cut, mortgage rates had already fallen almost two points from the highs of 2023, when they reached 8% in October. Mortgage rates got closer to the magical level of 6% at different points this fall, stimulating demand and giving the industry a much-needed but short-lived shot in the arm.
Unfortunately, the election brought in a whole new set of variables that affected mortgage rates and we are now ending the year with mortgage rates at about 7%. Terrible? No. Good? Also no.
“I understand the frustration with mortgage rates in 2024,” said Lead Analyst Logan Mohtashami. “Many people believed that the sub-6% mortgage market was coming, but the bond market held firm at a key level, much like Hodor from Game of Thrones held the door. As a result, another year has passed without mortgage rates falling below 6%.”
The HousingWire newsroom writes about mortgage rates multiple times a week (you can find all of those stories here) and we publish Mohtashami’s Housing Market Tracker every Saturday with weekly updates on the 10-year yield/mortgage rate outlook, housing inventory, sales, new listings, pending contracts and more.
“Mortgage rates remained within the range I anticipated this year,” Mohtashami said. “When economic and labor data weakened, bond yields and mortgage rates fell. Conversely, when the economic and labor data improved, rates surged back up. What we observed in 2024 was similar to 2023: mortgage rates decline when economic data weakens. For these rates to remain low for an extended period, the economy must continue to underperform or the mortgage spreads have to improve back to normal.”
Below are some of our top mortgage rate stories, starting in September, which illustrate what housing professionals have been through this year:
- Sept. 18: Fed goes big, slashing interest rates by 50 bps
- Sept. 19: Why did mortgage rates go up after the Fed rate cut?
- Sept. 22: Are these the lowest mortgage rates we’ll see in 2024?
- Oct. 16: Mortgage rates are back near 6.5%. Will they stay there?
- Nov. 6: Trump is victorious. Will mortgage rates go to 8%?
- Nov. 26: Mortgage rates are back above 7%. Is there relief in sight?
- Dec. 18: Powell’s remarks shoot mortgage rates higher
Where will mortgage rates go in 2025? Check out HousingWire’s 2025 Housing Market Forecast and sign up for the Housing Economic Summit on Feb. 26, where the very best housing economists will break it all down.
