Mortgage Rates Retreat Below 7%


Mortgage rates dipped significantly this week, retreating below 7% for the 30-year fixed term. Interest rates dropped meaningfully across most fixed-rate loan terms, including FHA, VA and jumbo loans.

Here are the current average mortgage rates, without discount points unless otherwise noted, as of Nov. 17:

  • 30-year fixed: 6.94% (down from 7.33% a week ago).
  • 20-year fixed: 6.77% (down from 7.37% a week ago).
  • 15-year fixed: 6.27% (down from 6.49% a week ago).
  • 10-year fixed: 6.37% (down from 6.61% a week ago).
  • 5/1 ARM: 5.56% (down from 5.57% a week ago).
  • 7/1 ARM: 5.69% (equivalent to 5.69% a week ago).
  • 10/1 ARM: 5.86% (up from 5.82% a week ago).
  • 30-year jumbo loans: 6.91% (down from 7.33% a week ago).
  • 30-year FHA loans: 6.1% with 0.06 point (down from 6.63% a week ago).
  • VA purchase loans: 6.23% with 0.05 point (down from 6.58% a week ago).


”Mortgage rates tumbled this week due to incoming data that suggests inflation may have peaked. While the decline in mortgage rates is welcome news, there is still a long road ahead for the housing market. Inflation remains elevated, the Federal Reserve is likely to keep interest rates high and consumers will continue to feel the impact.”

– Sam Khater, Freddie Mac's chief economist, in a Nov. 17 statement

As Khater notes, inflation rose at a 7.7% annual pace in October, according to the Bureau of Labor Statistics. While this remains far above the Federal Reserve's 2% annual target, it represents a slowdown from August and September, when consumer prices rose 8.3% and 8.2% year over year, respectively.

Economists are hopeful that inflation may have peaked, although the Fed isn't going to hit the brakes on rate hikes anytime soon. The central bank will likely keep interest rates high until there's further proof that consumer prices are under control, which will mean that mortgage rates will remain relatively elevated.

Indicator of the Week: 2023 Housing Market Outlook

The housing market and greater economy are expected to grow in 2024 after a "mild downturn" in 2023, according to a monthly forecast from Fannie Mae.

"The economy continues to slide toward a modest recession, which we anticipate will begin in the new year, with housing leading the slowdown," Doug Duncan, Fannie Mae's chief economist, says in a statement. "Higher interest rates have ignited the typical reduction in residential fixed investment, which historically has led into either an economic slowdown or recession."

Fannie Mae projects that home sales will hit a trough in the second quarter of 2023 before gaining momentum again in 2024. Here's a look at total home sales in 2021 and how the figures compare with Fannie Mae's forecast for the following three years:

  • 2021: 6.89 million units (up 6.6% year over year).
  • 2022: 5.67 million units (down 17.7% year over year).
  • 2023: 4.42 million units (down 22% year over year).
  • 2024: 5.25 million units (up 18.6% year over year).

The housing market recovery predicted for 2024 has three catalysts, according to the report: a broader economic recovery, an ongoing supply deficit and a "modest pullback" in mortgage rates. Average interest rates for the 30-year fixed mortgage are predicted to fall from 6.8% in 2023 to 6.1% in 2024, although they will still remain meaningfully higher than 3% in 2021 and 5.4% in 2022.

While 6% mortgage interest rates may not seem like a huge win for those who were able to take advantage of 3% rates in 2021, marginally lower rates are still a welcome relief to economists. Some of the homebuyers who are currently priced out of the real estate market may begin to compete when rates drop a percentage point or two over the next several years.

"From our perspective, the good news is that demographics remain favorable for housing, so the sector appears well-positioned to help lead the economy out of what we expect will be a brief recession,” Duncan adds.



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Drawing on his decade of experience in finance, investment management, and holistic financial planning, and as a Chartered Financial Analyst ( CFA ® ) charterholder, he leverages his financial acumen and analytical focus to help his clients navigate the sophisticated San Francisco market.
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