Mortgage Bankers Association December 2018 Rate Forecast
The December 2018 Mortgage Bankers Association rate forecast for the 30 year fixed rate mortgage has us ending with a slightly lower forecasted rate for this final quarter of 2018 than previously forecasted. Even the quarterly forecasted rates moving through 2019 have been slightly revised downward from the previous forecast. The forecast is predicting more marginal rate growth in 2019 plateauing around 5.0 percent while the forecast holds steady at only 5.1 percent for all quarters in 2021.
Looking back to the 2017 forecast predictions one year earlier, the forecasted average quarterly rate was actually higher than the average quarterly rate we have today suggesting that the anticipated rate increases have curtailed during the past 12 months but not by a significant margin. None-the-less, the rates are still forecast to meander upward slowly at least through 2019. Expect fluctuations in the rate as the 30-year fixed rate mortgage as we kick off 2019 with the more aggressive rate rise during the early part of the year.
Depending on market demand, the mortgage rates can pave the way for an increase in home values as mortgage rates remain relatively stable with not much deviation in the quarters ahead. The flip side is that when the real estate market becomes stagnant, buyers are not as pressured by rising mortgage interest rates to make a purchase. However keep in mind that according to Freddie Mac's September 2017 outlook report, total home sales are expected to rise with a 4.9 percent increase in home prices in 2018. Complacent buyers may get out priced if the real estate market continues its record level upward trend.
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So what do these rates mean if you are seeking a Veteran's Assistance or VA home loan? The rates one actually qualifies is based on several factors including the loan program, credit score and credit worthiness. The forecast rates are only intended to provide you with insight into what the market considers as the overall average rate for the given period. You must check with your financial institution to find out what rate you qualify and in some cases that rate may be lower than what you see forecast by Mortgage Bankers Association. VA home loan is a home loan guaranty program offered to Veterans, military service members and eligible surviving spouses.
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