Mortgage Rates Reach New High in 2024

The average interest rate for a 30-year mortgage in the U.S. hit its highest level since July, closing out the year at 6.85%. According to Freddie Mac, this is up from 6.72% the previous week.

Freddie Mac cites an "overwhelming undersupply of homes" for the increased interest rate.

However, there is some optimism going into the new year.

"A strong economy can help build momentum heading into the new year and potentially boost purchase activity."

The National Association for Realtors reported that existing home sales grew in November, up 48% from October. The association says first-time buyers were responsible for 30% of those sales.

"Home sales momentum is building," said NAR Chief Economist Lawrence Yun. "More buyers have entered the market as the economy continues to add jobs, housing inventory grows compared to a year ago, and consumers get used to a new normal of mortgage rates between 6% and 7%."

Most economists predict the average rate for a 30-year mortgage will remain above 6% in 2025.