The interest rate for the 30-year fixed-rate mortgage averaged 3.9% for 2019, the fourth lowest annual average since 1971, according to Freddie Mac. For 2020, Freddie’s outlook mirrors that of the real estate industry’s top economists, who discussed their predictions at the National Association of REALTORS®’ first-ever Real Estate Forecast Summit earlier this month: Low mortgage rates and an improving economy will help drive steady home sales, construction, and increases in home prices.
“While the outlook for the housing market is bright, worsening housing affordability is no longer a coastal phenomenon and is spreading to many interior markets, and it is a threat to the continued recovery in housing and the economy,” says Freddie Mac Chief Economist Sam Khater. NAR Chief Economist Lawrence Yun, too, has long called for greater home building in entry-level price points to satisfy affordability and housing demand for first-time buyers.
It seems like all savings in interest rates are offset by the increase in cost of housing