Experts Change Their Minds On Duplex Mortgage Rates

For everyone waiting for lower mortgage interest rates heading into winter and 2025, last week’s projections by economists at Fannie Mae and the Mortgage Bankers Association were bad news.

Both predict mortgage rates will stay above 6% next year and as a result, property sales will decline.

It’s important to keep economists’ projections in context. These same experts predicted last month that mortgage interest rates would fall to 6% by the end of the year and 5.6% by the end of next year.

Fannie Mae’s experts now think rates will edge toward 7% by the end of 2024, and stay above 6% into 2026. The Mortgage Bankers Association think 2025 will average 6.4%.

Both organizations believe recent rate increases are partly due to concerns about the incoming presidential administration’s fiscal, housing, trade, and immigration policies.  Of course, should any of these anticipated changes to current policy be modified, so too will the predictions.

Experts warn higher mortgage rates may result in fewer real estate sales next year; due in part to rates, and in part to owners reluctant to part with properties refinanced or purchased when rates were in the 2’s and 3’s during Covid.

The moral of the story, I suppose, is to simply buy or sell a duplex when it’s right for your life. You can’t predict the mortgage or housing markets. And neither can the experts.