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Interest rates

Mortgage Rates Continue to Trend Down in September 2024

Strategic Insights

— 2 min read

Mortgage rates have been slowly decreasing since August 2024, with 30-year fixed rates dropping near 5.70% according to Zillow data. This trend is expected to continue in the coming months as the Fed prepares to cut its benchmark rate, potentially leading to a further decline in mortgage rates. Homebuyers and refinancers are advised to take advantage of these lower rates, but should also carefully consider their financial situation and budget before making any decisions.

Key Takeaways:

  • Mortgage rates have dropped around half a percentage point since August 2024, with 30-year fixed rates now near 5.70% according to Zillow data.
  • The Fed's benchmark rate is expected to be cut, leading to a potential further decline in mortgage rates.
  • Homebuyers and refinancers should take advantage of lower rates, but should also carefully consider their financial situation and budget before making any decisions.
  • 30-year fixed-rate mortgages are the most popular type of home loan, but may have higher rates than other loan options such as 15-year fixed-rate mortgages.
  • Adjustable-rate mortgages (ARMS) have been slightly higher than fixed rates recently, but may offer lower monthly payments for borrowers with a low credit score or limited down payment.
  • FHA interest rates were 5.03% in August 2024, and have been trending lower in recent weeks.
  • VA mortgage rates are also in the low 5% range, according to Zillow data.
  • Mortgage refinance rates have also been lower in September 2024, with 30-year refinance rates averaging 6.59% in August.
  • Borrowers should carefully consider their financial situation and budget before refinancing, as the costs of refinancing can add up.
  • The lower the mortgage rate, the more a borrower can afford to borrow.
  • Experts recommend spending no more than 28% of gross monthly income on housing expenses.

Statistics:

  • 30-year fixed mortgage rates: 5.70% (according to Zillow data)
  • 15-year fixed mortgage rates: 5% (according to Zillow data)
  • 7/1 ARM rates: 6.17% (according to Zillow data)
  • 5/1 ARM rates: 6.22% (according to Zillow data)
  • FHA interest rates: 5.03% (in August 2024)
  • VA mortgage rates: in the low 5% range (according to Zillow data)
  • 30-year refinance rates: 6.59% (in August 2024)
  • Mortgage Bankers Association expects home prices to increase 4.1% in 2024 and 2.9% in 2025
  • Fannie Mae researchers expect home prices to increase 6.1% in 2024 and 3.0% in 2025

Sources:

  • Zillow data
  • Business Insider
  • Freddie Mac data
  • Fannie Mae researchers
  • Mortgage Bankers Association
  • Federal Housing Administration
  • Department of Veterans Affairs

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