The 30-year fixed mortgage rate is predicted to average 3.4% in the fourth quarter of 2021, rising to 3.8% in the fourth quarter of 2022.

Freddie Mac's Economic and Housing Research Group finds a lot to like in the present economic environment. The company's quarterly forecast credits the increasing availability of COVID-19 vaccines and the easing of virus-related restrictions, the passage of the American Rescue plan and its cash stimulus for households, as setting the stage for economic growth and sending consumer confidence to a post pandemic high in March. The labor market, while still needing to add 8.4 million jobs, put 916,000 on the books last month, the greatest gain since August. All in all, the report says conditions should remain generally favorable for the housing and mortgage market through 2022, although rising rates could provide headwinds that slow housing activity. The group predicts the 30-year fixed mortgage rate will average 3.4 percent in the fourth quarter of 2021, rising to 3.8 percent in the fourth quarter of 2022. House price growth is expected to average 6.6 percent in this year then slow to 4.4 percent in 2022. Home sales, new and existing, should reach 7.1 million in 2021, then fall to 6.7 million homes in 2022. 

Source: Mortgage News Daily