The Mortgage Bankers Association (MBA) says it believes the average rate for a 30-year mortgage will start at 2.9% in the first quarter of 2021 and gradually increase to 3.2% by the end of 2021. Looking even further down the road, the MBA has 2022 rates peaking at 3.6%.
The National Association of Realtors expects mortgage rates to average 3.1 percent in 2021, up from 3 percent in 2020. The Mortgage Bankers Association says rates will average 3.3 percent in 2021.
In the Fed's December Summary of Economic Projections, no FOMC participant expects a rate hike in 2021. ... Five expect at least one rate hike by the end of 2023. So in this best case scenario, the Fed will start hiking rates by either the end of 2022 or 2023.
The FOMC meeting begins today. The meeting will end on Wednesday with the release of the FOMC statement scheduled for 2:00pm. After the statement release, a press conference by Fed Chair Jerome Powell will take place at 2:30pm. No policy changes are expected from this meeting. Most of the news should come from the press conference.
At the press conference, reporters will likely ask Fed Chair Powell about recent comments from regional Fed presidents suggesting that the Fed could start tapering its bond purchases by later this year. Although Powell will likely be optimistic about the economy in the latter half of 2021, he will probably dismiss any talk of tapering. Economist Tim Duy described in his FedWatch FOMC preview the likely message that the Fed Chair will give:
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