The cost of buying a house is still out of reach for many want-to-be buyers, but one thing's for sure: mortgages themselves are very cheap. Even though the Federal Reserve is now in a tightening cycle, mortgage rates are still historically a good deal.
Funky Mortgage Rate Patterns
As of 6/29/2017 (per Freddie Mac), the average 30-Year mortgage rate stood at 3.88% for a 30-Year conventional mortgage. The 3.31% we touched in November of 2012 it is not - but that's still historically an awesome deal. By our math, taking that series back to April of 1971 that's in the lowest 5.64% of all weekly average mortgage rates.
The funkiness, however, is that mortgage rates haven't (yet?) followed the Fed up. Here's what the 30-Year looks like overlaid with the Effective Federal Funds Rate:
Interestingly, you can see the mortgage rate is actually in a bit of a downtrend. After an initial period of rising rates post-election, rates peaked in March and have since come down almost half a percentage point. Here's a closer look at the numbers post-election:
| Date | Average 30-Year Mortgage Rate |
| 11/03/16 | 3.54% |
| 11/10/16 | 3.57% |
| 11/17/16 | 3.94% |
| 11/23/16 | 4.03% |
| 12/01/16 | 4.08% |
| 12/08/16 | 4.13% |
| 12/15/16 | 4.16% |
| 12/22/16 | 4.30% |
| 12/29/16 | 4.32% |
| 01/05/17 | 4.20% |
| 01/12/17 | 4.12% |
| 01/19/17 | 4.09% |
| 01/26/17 | 4.19% |
| 02/02/17 | 4.19% |
| 02/09/17 | 4.17% |
| 02/16/17 | 4.15% |
| 02/23/17 | 4.16% |
| 03/02/17 | 4.10% |
| 03/09/17 | 4.21% |
| 03/16/17 | 4.30% |
| 03/23/17 | 4.23% |
| 03/30/17 | 4.14% |
| 04/06/17 | 4.10% |
| 04/13/17 | 4.08% |
| 04/20/17 | 3.97% |
| 04/27/17 | 4.03% |
| 05/04/17 | 4.02% |
| 05/11/17 | 4.05% |
| 05/18/17 | 4.02% |
| 05/25/17 | 3.95% |
| 06/01/17 | 3.94% |
| 06/08/17 | 3.89% |
| 06/15/17 | 3.91% |
| 06/22/17 | 3.90% |
| 06/29/17 | 3.88% |
Winning the Mortgage Rate War
Mortgage rates are generally (read: when not purchased en masse by a Central Bank) driven by the market's whims, so keep an eye on Treasury rates rates to see how longer term debt is doing in general. A quick glance at 5-Year and 10-Year rates illustrates recent rate changes well:
So, if you're in the market to refinance - or if you're flush with cash looking to buy after swearing off your avocado habit - know mortgages are cheap. Prices, yes, are not so great - but we'll look into affordability in a future article.
