Hopes that the nation’s mortgage rates might decline or at least flatten out have very much proven unrealistic so far this year, notes a well-known economist with the National Association of Realtors.
In fact, remarked Lawrence Yun, NAR chief economist, mortgage rates will average 6.4% in the second half of 2025 and 6.1% in 2026.
“The housing market remains very difficult at the moment,” said Yun, who added: “Part of the delay in recovery is because the Federal Reserve has changed its outlook and appears to be on a pause for a longer period.”
Notes the site yahoo!finance: “The Federal Reserve continues to slow walk rate cuts. The market isn’t expecting to lower short-term interest rates until September at the earliest.”
Said Yun: “Mortgage rates are the magic bullet, and we’re waiting and waiting until those come down.”
The current 30-year fixed rate mortgages are now at the same point where they were just before the onset of the Great Recession in 2007, according to Freddie Mac statistics.
While the current numbers may be sluggish, they are nowhere near where things stood at the end of President Carter’s presidency, when they reached an all time high of 16.6%.
Looking at the trend lines since 2023, Yun remarked: “Home sales have been very difficult over the past two years. We’ve had the lowest home sales in 20 years for two consecutive years.”
For all of that, the NAR is forecasting that home sales will ultimately be up by a notable 10% by the end of 2025, followed by another increase, this one of 5%, in 2026.
The nation’s median home price, meanwhile, asserts Yun, will climb by some 3% for the rest of this year, and 4% next year.
June 5, 2025
By Garry Boulard
Image courtesy of Pixabay
