Mortgage rates are falling, and they’re considerably lower than a recent peak reached in October at about 8%. But even now, with the average 30-year fixed mortgage rate at 6.69%, it’s not nearly enough to restore affordability, let alone push home prices down.
In a research note published Friday, Capital Economics’ property economist, Thomas Ryan, wrote that the firm doubts the modest fall in mortgage rates will bring “a great deal more stock onto the market.” That matters because the supply of homes, particularly existing homes, is already tight, and that has generally kept home prices up. Because it doesn’t see substantial increase in supply ahead, Ryan’s firm revised its home price prediction—and revised it upward.
