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Mortgage rates this week
Fixed mortgage rates continued trending downward in the week ending March 14.
The 30-year fixed-rate mortgage averaged 6.66% APR, down 18 basis points from the previous week's average, according to rates provided to NerdWallet by Zillow. A basis point is one one-hundredth of a percentage point.
The 15-year fixed-rate mortgage averaged 5.97% APR, down 15 basis points from the previous week's average.
The 5-year adjustable-rate mortgage averaged 7.85% APR, down two basis points from the previous week's average.
Mortgage rates were down for a second week in a row. In the latest Mortgage Bankers Association’s Weekly Mortgage Applications Survey, Mike Fratantoni, senior vice president and chief economist at the MBA, attributed rates dropping below 7% to “incoming economic data showing a weaker service sector and a less robust job market, with an increase in the unemployment rate and downward revisions to job growth in prior months.”
Visions of more meaningful cuts to interest rates in early 2024 are starting to fade for some home buyers, and they’ve entered the next stage of APR Grief: acceptance. These borrowers are biting the bullet and getting into the market, as evidenced by a 5% uptick in purchase mortgage applications week over week on a seasonally adjusted basis and 6% on an unadjusted basis in the week ending March 8, according to the MBA’s survey. This is still 11% below where mortgage applications were this time last year.
The survey shows that refinance volume is also on the rise — up 12% across refinances and up 24% for government loan refinances — suggesting that homeowners who bought their homes within the past two years of rate heights don’t feel it’s worth waiting any longer to snag a lower rate. “While these percentage increases are large,” said Fratantoni, “the level of refinance activity remains quite low, and we expect that most of this activity reflects borrowers who took out a loan at or near the peak of rates in the past two years.”
Among all mortgage activity last week, refinances accounted for 31.6% of all applications, up from 30.2% the previous week.
Curious homeowners weighing the pros and cons of refinancing can estimate their potential savings using NerdWallet’s refinance calculator.
March mortgage rates forecast
Mortgage rates are likely to remain relatively unchanged in March. A decisive drop in rates probably won't happen until the Federal Reserve signals that it's satisfied that inflation is headed toward the central bank's goal of 2%.
What other forecasters say
Forecasters from mortgage securitizer Fannie Mae, the Mortgage Bankers Association and the National Association of Realtors expect mortgage rates to fall to around 6% late this year.
