Although they have fallen to historic lows, as the economy improves, mortgage rates are predicted to trend up. The Mortgage Bankers association says rates will average 3.3% in 2021. “That means the refinancing boom of 2020 should slow dramatically by the second half of 2021,” said Michael Fratantoni, chief economist at the Mortgage Bankers Association.
However, Sowell agent Alan Crenshaw adds this caveat, “Even with rates averaging 3.3%, that is still near record lows for mortgage rates. I think it may have an effect on refinancing, but I don’t think it will affect buyers who are in the market for a home now.”
Alan added, “Currently Memphis has very low inventory, but rates this low are still bringing buyers to the market who are looking to lock in these amazing rates. I suspect 2021 to be just as competitive of a market as 2020.”
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