When Will Minneapolis Duplex Mortgage Rates Drop?

The other day I heard a speaker say U.S. mortgage interest rates dropped below 3% only once in history; during the Covid outbreak of 2021.

Of course, I didn’t believe him so I had to look it up with Freddie Mac. Turns out he was right.

It made me wonder how many times they’d dropped below 4%. Going back to 1977, I can only find 7 years; 2021, 2013, 2015-17, 2019-2020. Mortgage rates typically drop dramatically when something catastrophic happens. While the Great Recession started in 2008, it took several years to reduce unemployment rates and work through the foreclosure and short sale inventory.

Interest rates averaged between 4 and 5% in 2010, 2011, 2014, and 2018.

So it makes sense people would think it wise to wait for rates to drop. After all, lower has been the norm for just over a decade.

Here’s reality. The last decade was the exception, not the rule.

The average mortgage interest rate in the 1990’s was 8%.

In October 1981 when inflation was at 10.3%, mortgage interest rates set a historical average high of 18.63 percent. By the end of the ’80’s rates had dropped into the 9’s, helping drop the 10-year average t0 12.7%.

And the average mortgage interest rate from 1971 to 2025 is 7.72%. The 1960’s averaged 7%.

Between 1946 and 1960 they ranged from 4.35% to 5.09%. That’s because the country, and the world, were experiencing a strong recovery after World War II. Again low rates were due to something catastrophic.

And in every single one of those decades, properties continued to appreciate in value; regardless of the interest rates.

So what do they look like today? Depending on the day, your credit, and economic reports, mortgages rates seem to be floating in the high 6’s and low 7’s.

From a historical context, that doesn’t seem too bad. Of course, one could also wait until the next major economic disruption caused by war, a banking crisis, or a pandemic and the subsequent mortgage rate drops.

But if I were to make a bet, it would be if you buy a duplex, triplex or fourplex now you’ll make more in appreciation, tax savings and cash flow than you’ll save by waiting.