Mortgage Interest Rates hit their lowest levels in more than a year and a half last Tuesday right before the Fed announcement to lower the Fed Funds rate by .50%. Great news! And after the Fed cut rates, wouldn’t that mean mortgage rates would go down further??? Well……
On Monday the average lender for a 30 year fixed mortgage interest rate was at the highest levels since November 10th 2023. So rates went up. What the what?
This may sound backwards, and definitely not good news for homebuyers. But we should keep in mind these are still the lowest rates since February 2023, and still sharply lower versus the late 2023 highs or even the highs from just 2 months ago. We also need to keep in mind why rates dropped in the first place, before the Fed Meeting. It was all about the market getting excited about the new shift in thinking by the Fed to start lowering their rate. This small correction seen since then is understandable and it should run its course fairly soon.
The only catch is that economic data has been and will continue to be a bigger driving force for rate momentum than the ebbs and flows surrounding Fed policy decisions. After all, those Fed policy decisions are based on economic data anyway.
