Fannie Mae’s Latest Forecast Anticipates Record Breaking Low Mortgage Rates to Decline Further

According to the latest Fannie Mae forecast, which was released on Monday June 15th, the lowest mortgage rates on record are about to be moving even lower. Fannie Mae is reporting that the annual average mortgage rate in 2020 will be 3.2%, down from 2019’s rate of 3.9%. According to Freddie Mac, this would beat the record of 3.65% set in 2016. Fannie Mae expects mortgage rates will drop to 2.9% in 2021. Doug Duncan, Fannie Mae’s chief economist said, that the mortgage-rate forecast bodes well for housing demand and for refinancing volume. Duncan went onto say, “While housing took a big hit this quarter, we believe the further reduction of mortgage rates, persistently low levels of supply, and strong buyer sentiment compared to seller sentiment should continue to provide support to home prices and new construction.”