How high will mortgage interest rates go over the course of the next 12 months?
Some of the experts have come out this week with their predictions. Fannie, Freddie, the Mortgage Bankers Association, and the National Association of Realtors (NAR) have come out with their predictions as to what they think is going to happen with mortgage interest rates.
When we look at averages here for Q4 of 2022, the experts are predicting mortgage or interest rates to be right around 5.4 percent. As we go into 2023 in Q1, we’re expecting just a little bit of relief at 5.3 percent. Same holds true into Q2 of 2023, when we could see mortgage rates that are roughly 5.2 percent.
The bigger change seems to happen or is predicted to happen in Q3 of 2023, where they are predicting we might see mortgage interest rates back under 5 to 4.8 percent. Of course, nobody is 100% sure where things are going, and we will see fluctuations in mortgage interest rates over the course of the next year.
If you find the right home and it checks all the boxes, it would be good to move forward with that purchase. You can lock in that rate today, and possibly, take advantage of paying some points which are tax deductible, negotiating to have the seller pay a few points. You could also try an adjustable rate mortgage where we see a lower interest rate at the start of the term