Perspective in Mortgage Rates: How Current Rates Compare to the Past

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Filed under: Market Comentary

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Today I want to bring some perspective on interest rates, helping you see the whole picture of the mortgage industry. Rates have been on an uptrend for 18 months, with a little bit of normal volatility along the way.

Short-Term and Long-Term Trends in the Mortgage Industry

Now we are at a point where we are hovering at 4-year highs without relief in sight. It looks like inflation will keep influencing the economy. No one knows what the future holds, but most experts in the industry have the mindset of buckling down because rates are going to continue to move up a bit. These changes won’t likely be huge, but the trends seem to be in a steady increasing pattern.

I pulled some charts to share information with my customers. The first chart shows the last 18 months with another chart that displays information back into the 80’s. Looking at the last 18-months, it is apparent that the rates are going up.

 

There’s no denying that rates are higher right now than they were a year and a half ago. But, it’s crazy to see if you draw it out and look at a much longer timeline. Overall, we can see that we are in a general down trend for interest rates. Back in the 80’s, fixed mortgage rates were in the upper teens, which is higher compared to the current interest rates that are coming in around 4.6%. The historical average is in the mid-7% range, so we are currently well below the average.

Keeping the Right Perspective

Yes, rates are up… but that doesn’t mean that home buyers should be worried about the current options. I still remember the moment about ten years ago when I was able to lock in an interest rate with a 4 in front of it. We were so excited at the time that we were running around the office high-fiving each other. We are still below those ranges.

Whether you are in the mortgage or real estate industry, you are probably hearing a lot of questions from your clients about real estate rates. Hopefully, this information will help you understand the perspective that will show clients that there is nothing to worry about. Share this video with them if they are interested in more information. Also, don’t forget to like or comment!

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