There has been a ton of buzz about rising interest rates for home mortgage loans in the last year since the Federal Reserve started raising rates. Are we living in unprecedented times?
Freddie Mac, who began keeping data on mortgage interest rates in 1971, offers some of the most comprehensive historic mortgage rate data available. According to their records over the past 50+ years, the historical average for mortgage rates has been 8%, but there have been vast fluctuations from historic highs to historic lows in that timeframe.
For example, mortgage rates reached a historic high of 18.63% in October 1981. On the other hand, the average mortgage rate hit a historic low of 2.65% in January 2021. Today, in February of 2023 the average mortgage rate is right around 7%. While rates aren't as attractive as they once were, we haven't even hit the historic average interest rate.
For those of us who missed the boat on buying a home in 2021, at least we're in better shape than the folks who bought in 1981!