Interest Rates Drop Below 3% on 30 Yr Fixed Rate Mortgages!

30 Year Fixed Mortgage Interest Rates At All Time Low!

For several weeks interest rates on mortgages have continued to drop to record lows. Freddie Mac has reported the average interest rate on a 30 yr fixed at 2.98%!  That is the first time on record that interest rates have dropped below 3%! Records date back to 1971. In the 70’s the average mortgage interest rate was 8.86%. Interest rates peaked in the 80’s at 18.63%!!! They have been dropping ever since then with some ups and downs along the way. The previous low was in 2012 at 3.36%. With the economy growing stronger interest rates were creeping up.

The U.S. Federal Reserve Bank (FED) has committed to doing everything they can to help the U.S. economy rebound from the global pandemic economic crisis in any way that they can. The FED rates are currently at .25% which are nearly as low as they can go. The FED did do an emergency rate cut to 0% in March 2020 to help bolster the economy. And it looks like it may be working, at least in the real estate front!

What Does This Mean For Buyers?

After a sluggish 2019, home prices continue to grow with huge buyer demand in 2020. The continually improving interest rates are aiding in keeping mortgages at an all time affordability. Lower monthly payments means savings can add up significantly over time. It also means buyers can purchase more with their money.

Across the nation cities are experiencing a mass-exodus as people are indefinitely working remotely. There is such severe buyer demand that inventory for existing homes is at all time lows. In the Tahoe Truckee area we are seeing 2-3 weeks of inventory listed at any given point in time. Competition is high and multiple offers are the norm. With many people working remotely having no need to be anywhere specific geographically coupled with interest rates at all time lows it’s no wonder we’re seeing such strong buyer demand! Experts agree the strength of the current housing market has the ability to tremendously aid in the economic recovery nationwide.

Bottom Line

The market is competitive for buyers but if you can persevere then you could enjoy building equity with record low interest rates! If you’re a seller then be ready for a quick sell!