In 2020, mortgage interest rates dropped below 3% for the first time, eventually reaching a record low of 2.65% in January 2021. This unprecedented drop fueled a housing boom as many Americans capitalized on lower borrowing costs. However, experts indicate that the unique conditions leading to these low rates are unlikely to be repeated. Economists warn that waiting for a return to these historically low rates may be more costly than beneficial for potential homebuyers.
"The unprecedented conditions that triggered these historically low rates are not likely to be repeated," says Hannah Jones, senior economic research analyst at Realtor.com®.
"The 3% rates from a few years ago were an abnormality, not normal market conditions," says Carlos Scarpero, a mortgage broker at Edge Home Finance.
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