According to Fannie Mae, mortgage rates are expected to average 6.8% until 2025, influenced by persistent inflation and uncertainties surrounding trade policies related to President Trump. This marks the second consecutive upward revision in predictions from Fannie Mae, reflecting a significant rise in rates over the past months, staying stubbornly close to 7%. Economic growth has exceeded expectations, but trade uncertainties are adding risks to the GDP and inflation outlooks. Existing-home sales projections have also been revised slightly upward for 2025, although sales are still expected to be significantly lower compared to 2019.
Mortgage rates will likely remain higher this year than previously expected due to persistent inflation and lingering uncertainty about President Donald Trump's trade policy.
Fannie Mae's Economic and Strategic Research Group also revised its projection for existing-home sales slightly upward for 2025 due to a stronger-than-expected December sales pace.
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