Economists are forecasting that mortgage interest rates are going to rise in 2019. The National Realtors Association says that 30-year fixed rates will rise from 4.7% in 2018 up to 5.5% by the end of 2019. The California Association of Realtors is forecasting rates for 30-yr fixed rising to 5.2%. They are forecasting rates to rise by 0.5% to 0.75% from their 2018 level of 4.7%. Note that as of today the 30-yr fixed rate has declined to 4.45%!

There might be an interesting opportunity for Buyers over the next few months. First is the above news that rates are down and Buyers should try to lock-in these rates before they start rising again. The second is that recently declined stock prices might encourage some buyers to delay buying a home until their stock returns to previous levels. Both market pressures reduce the number of Buyers in the market, reduce the number of competing offers, reduce how much over list price and reduce the size of your mortgage payment. 

Buyers should be doing their homework. There might be some unique opportunities to purchase a great home this coming February-March.

U.S. Average Mortgage Rates over 10 years
30-yr Fixed (blue), 15-yr Fixed (Green) and Adjustable (Red)


Rates jumped up significantly last fall to a high of 4.94% in November. Then suddenly declined to its current level of 4.45% for 30-yr Fixed. This decline is attributed to the drop in 10-year Treasury Bonds from 3.2% in October to 2.7% today. A drop of 0.5% which is virtually identical to the drop in mortgage rates. The drop in Treasury Rate is attributed to a significant increase in demand for US Bonds as investors moved funds out of the volatile equity markets.

10-Year Treasury Rate over 10 years


Suggests that Treasury Rates and Mortgage Rates will return to their previous levels once the stock market settles down. A more immediate impact might be some buyers decide to side to the sidelines while they wait for their stock options to return to their preivous levels. Wouldn’t you be tempted to wait? 

S&P 500 Index over 10 years


2019 Outlook: 30-year fixed rates rise to 5.2%