Fannie Mae expected mortgage rates

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Fannie Mae expected mortgage rates

Chris SeveneyBusiness Member
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Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes

 For those who are thinking we're going to see any significant declines in interest rates, Fannie Mae just published their expected mortgage rates over the next 18 months, which show they are expecting rates to be very consistent in the low sixes. What are your thoughts? 

6.2% in Q3 2026 
6.1% in Q4 2026 

6.1% in Q1 2027
6.1% in Q2 2027
6.1% in Q3 2027
6.1% in Q4 2027

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  • Kenneth GarrettPro Member
    Investor · Florida Panhandle/Illinois · Member since 2016 · 4k+ posts · 3k+ votes
    5mo

    That is disappointing, but realistic. I remember when DSCR rates were consistently about 5.5%. That was a sweet spot for me and could rely on those numbers for the most when underwriting projects.

    I’m just hoping to stay away from the big jumps.  If it hovers around 6.1 - 6.2 at least I know where I stand.  I can deal with rates that are fairly consistent and when or if rates drop enough, I can always refinance.

    Thanks for sharing.

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    • Chris SeveneyBusiness Member
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      Investor · VA · Member since 2015 · 21k+ posts · 19k+ votes
      5mo

      @Kenneth Garrett -  unfortunately, people get used to interest rates that are so low that we will probably never see again, as this is more in line with the historic norm. The issue is that home values have not come back down to reality based on today's interest rates. They're slowly starting to, but it'll take some time before pricing to begin to level off for a period of time, as there's only so much people can pay based on interest rates being at this amount. Even though the government pumped $7 trillion into the economy and a good amount went into real estate, you're starting to see it flow into other asset classes, which will soften real estate. 

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  • V.G JasonPro Member
    Investor · Member since 2022 · 3k+ posts · 3k+ votes
    5mo

    It'll be a slow bleed. 2023-2029 will likely be akin to the equities in '00s; flattish with a negative real return. 

    This is why we buy for the long term. And no, I am not predicting we'll face an 08-09 again. 

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