Despite rising 4 basis points, the average rate on a 30-year fixed mortgage remained below 3%, averaging 2.99 in Freddie Mac’s latest weekly survey.

Mortgage rates plunged in 2020 as the U.S. economy sagged during the coronavirus pandemic, but most experts expect 2021 to end with higher rates overall – though still low compared to historical standards.

In a separate Bankrate survey, the 30-year average rate also rose, to 3.19%. The variance with the Freddie Mac count is due to the fact that the Bankrate figure includes points and set-up fees by an average of 0.32%, while the Freddie count excludes these costs. Freddie Mac said his rate came with an average of 0.8 points.

“Home prices continue to accelerate as inventories remain low and new home construction cannot happen fast enough,” Sam Khater, chief economist at Freddie Mac, said in a statement. “Many potential buyers would like to take advantage of low mortgage rates, but the competition is fierce. For homeowners, however, keeping rates low makes refinancing an option worth considering. “

As Khater said, lower mortgage rates are great for refinancers, but the current market for potential buyers is more mixed. Low mortgage rates remain a positive factor, but the limited supply of housing coupled with increased borrowing power pushes up prices and increases competition significantly in most places. The mortgage and real estate markets can be particularly cutthroat for low-income and minority homeowners, which may be part of the reason why more black and Hispanic homeowners haven’t refinanced.

Where do mortgage rates go from here?

Most industry watchers expect rates to rise in the weeks and months to come, but predict that they will remain very low by historical standards, possibly for years to come.

In the short term, the market should remain particularly favorable to potential refinancers. Most mortgage experts interviewed by Bankrate expect rates to stay the same for at least a week.

“Regardless of the discussions of the transitional inflation numbers, go on a home hunt or take another trip to buy gas and you will see how real they are today,” said James Sahnger, Mortgage Planner at C2 Financial Corp. to Jupiter. , Florida. “Take advantage of the rates where they are, but it could be the low point of the summer. “

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