In many ways, this year was a year unlike any other. In the housing business, for example, the prevailing market interest rate for a 30-year, fixed-rate mortgage had never been lower than 3.3%, but then this year happened.
The prevailing rate, as tracked by Freddie Mac, fell below 3.3% for the first time back in March, and it’s stayed below that previous record low in almost every week since then. In fact, the prevailing rate has not only stayed below the previous record low, it’s continued falling, setting numerous records along the way.
That trend continued in the last week, as the latest data from Freddie Mac shows that mortgage rates hit another record low in the week ending December 24, 2020. That’s the 16th time that interest rates have hit a new record low this year.
According to Freddie Mac, the prevailing interest rate for the 30-year, fixed-rate mortgage was 2.66% in the last week, down from the previous week’s record low of 2.67%.
A year ago, the 30-year FRM averaged 3.74%.
And as others have recently opined, Freddie Mac’s economists expect interest rates to remain low for the foreseeable future.
“The housing market is poised to finish the year strong as low mortgage rates continue to fuel homebuyer demand and refinance activity,” Freddie Mac Chief Economist Sam Khater said. “Moving into 2021, we expect rates to hold steady but the key driver in the near term will be the trajectory of the COVID-19 pandemic and the execution of the vaccine.”