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Mortgage Interest Rates Today, February 23, 2024 | Rates Are Now Closer to 7% Than They've Been in Months
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The economy has been doing surprisingly well so far this year, and it's pushing mortgage rates back up.
Average 30-year mortgage rates rose 13 basis points to 6.90% this week, according to Freddie Mac. This is the closest this rate has been to 7% since mid-December.
Average 15-year mortgage rates also increased to 6.29% this week, a 17-point jump.
"Strong incoming economic and inflation data has caused the market to re-evaluate the path of monetary policy, leading to higher mortgage rates," Sam Khater, Freddie Mac's chief economist, said in a press release. "Historically, the combination of a vibrant economy and modestly higher rates did not meaningfully impact the housing market. The current cycle is different than historical norms, as housing affordability is so low that good economic news equates to bad news for homebuyers, who are sensitive to even minor shifts in affordability."
Once the Federal Reserve starts lowering the federal funds rate, mortgage rates are expected to go down as well. But the Fed is waiting for more data showing that inflation is coming down sustainably. Based on the data we've seen so far, we might not get a Fed cut until later this year.
Currently, investors believe that we won't see the Fed cut rates until June at the earliest, according to the CME FedWatch Tool. And depending on how inflation continues to trend, we may need to wait even longer.
This means we may be in for a much more subdued homebuying season than what was initially expected. If you're committed to buying a home this year even if rates remain high, you may benefit from less competition on the market.
But if you're waiting for rates to drop before you buy, it may be wise to use this time to pad your down payment savings, so when the time comes to jump into the market, you're able to make strong, competitive offers.
Today's mortgage rates
| Mortgage type | Average rate today |
| 30-year fixed | 6.70% |
| 20-year fixed | 6.44% |
| 15-year fixed | 5.99% |
| 7/1 ARM | 6.78% |
| 5/1 ARM | 6.78% |
| 30-year FHA | 6.00% |
| 30-year VA | 5.99% |
Today's refinance rates
| Mortgage type | Average rate today |
| 30-year fixed refinance | 6.67% |
| 20-year fixed refinance | 6.56% |
| 15-year fixed refinance | 5.90% |
| 7/1 ARM refinance | 7.48% |
| 5/1 ARM refinance | 6.80% |
| 30-year FHA refinance | 5.64% |
| 30-year VA refinance | 5.83% |
Mortgage Calculator
Use our free mortgage calculator to see how today's interest rates will affect your monthly payments:
By clicking on "More details," you'll also see how much you'll pay over the entire length of your mortgage, including how much goes toward the principal vs. interest.
Mortgage Rate Projection for 2024
Mortgage rates started ticking up from historic lows in the second half of 2021 and increased dramatically in 2022 and throughout most of 2023.
Many forecasts expect rates to fall this year now that inflation has been coming down. In the last 12 months, the Consumer Price Index rose by 3.1%, a significant slowdown compared when it peaked at 9.1% in 2022. But we'll likely need to see more slowing before rates can drop substantially.
For homeowners looking to leverage their home's value to cover a big purchase — such as a home renovation — a home equity line of credit (HELOC) may be a good option while we wait for mortgage rates to ease. Check out some of our best HELOC lenders to start your search for the right loan for you.
A HELOC is a line of credit that lets you borrow against the equity in your home. It works similarly to a credit card in that you borrow what you need rather than getting the full amount you're borrowing in a lump sum. It also lets you tap into the money you have in your home without replacing your entire mortgage, like you'd do with a cash-out refinance.
Current HELOC rates are relatively low compared to other loan options, including credit cards and personal loans.
When Will House Prices Come Down?
We aren't likely to see home prices drop this year. In fact, they'll probably rise.
Fannie Mae researchers expect prices to increase 3.20% in 2024 and 0.30% in 2025, while the Mortgage Bankers Association expects a 4.10% increase in 2024 and a 3.30% increase in 2024.
Sky high mortgage rates have pushed many hopeful buyers out of the market, slowing homebuying demand and putting downward pressure on home prices. But rates have since eased, removing some of that pressure. The current supply of homes is also historically low, which will likely push prices up.
What Happens to House Prices in a Recession?
House prices usually drop during a recession, but not always. When it does happen, it's generally because fewer people can afford to purchase homes, and the low demand forces sellers to lower their prices.
How Much Mortgage Can I Afford?
A mortgage calculator can help you determine how much house you can afford. Play around with different home prices and down payment amounts to see how much your monthly payment could be, and think about how that fits in with your overall budget.
Typically, experts recommend spending no more than 28% of your gross monthly income on housing expenses. This means your entire monthly mortgage payment, including taxes and insurance, shouldn't exceed 28% of your pre-tax monthly income.
The lower your rate, the more you'll be able to borrow, so shop around and get preapproved with multiple mortgage lenders to see who can offer you the best rate. But remember not to borrow more than what your budget can comfortably handle.
