Expert poll: Mortgage rate trend predictions for Sept. 21-27, 2023

Michael Becker

Branch manager, Sierra Pacific Mortgage , White Marsh , Maryland

As expected, the Fed held interest rates at their current levels. However, the long-term level of the federal funds rate as indicated by the dot plot — a projection of the future rates — shows that the Fed expects rates to stay higher for longer. This should put upward pressure on rates. Mortgage rates will be higher in the coming week.

Melissa Cohn

Regional Vice President, William Raveis Mortgage

The Fed left rates unchanged at the conclusion of their September meeting, but stated that they still expect one more rate hike before the end of the year, sending a clear message that rates will remain higher for as long as the rate of inflation remains above their target level. As such, I expect that rates will bounce around in the next week with a tilt to the upside. On the good news side: The Fed’s dot plot did also indicate the expectation that there would be two rate cuts in 2024. Once the last rate hike is behind us, mortgage rates will decline in a meaningful way.

Derek Egeberg

Certified mortgage planning specialist and branch manager, Academy Mortgage , Yuma , Arizona

Rates are moving higher. August core inflation rose again, higher than most experts expected. As mentioned last week, the market and the Fed have no choice but to keep rates moving higher. Until inflation goes down to the Fed’s target of 2 to 2.5 percent, do not expect rates to move lower. That Fed target from where we are now is a 50 percent decline in the inflation rate.

Greg McBride

CFA, chief financial analyst, Bankrate.com

The “higher for longer” interest rate theme and the prospect of a government shutdown at month-end have bond yields and mortgage rates on the rise.

Sean P. Salter, Ph.D.

Associate Professor of Finance and Dale Carnegie Trainer, Middle Tennessee State University , Murfreesboro , TN

Rates will be higher this week. The 30-year mortgage rate ticked higher last week, and the 10-year Treasury has been moving up in the past few weeks. Unless and until something significant and unexpected happens, I don’t see a huge jump or drop in mortgage rates — just small, incremental moves.

Nancy Vanden Houton, CFA

CFA, Senior Research Analyst, Stone & McCarthy Research Associates , New York , NY

Higher.

Heather Devoto

Vice President, Branch Manager, First Home Mortgage , McLean , VA

I expect rates to decline in the week to come, following in-line economic commentary from Fed Chair Powell.

Les Parker

CMB, managing director, Transformational Mortgage Solutions , Jacksonville , Florida

Mortgage rates [will] go down. Here’s a parody from The Beatles’ 1965 Rubber Soul classic album, “I’m Looking Through You”: “You don't sound different. They've learned the game. Bonds looking through you. Fed’s not the same.” The Fed wants the long end to not jump the gun while it jumps the shark. It wants to hold another tightening in its pocket to keep markets in line, but it only proves the Fed’s show is over. One tightening and higher longer is all it has.

Ken H. Johnson

Real estate economist, Florida Atlantic University

Ten-Year Treasury prices will hold steady this week resulting in the yield on 10-Year Treasurys remaining steady with little change. Mortgage rates follow the yield on 10-Year Treasurys. No change in yields will result in no change in mortgage rates. Next week, mortgage rates should remain unchanged. This should be the last week of low volatility in mortgage rates as the debate over a federal shutdown heats up.

Dick Lepre

Loan agent, CrossCountry Mortgage , Alamo , CA

Trend: Flat. Markets don't seem to care whether or not the Fed hikes. Too little attention is paid to M2 money supply which has been falling and could cause a mild recession in 2024.

James Sahnger

Mortgage planner, C2 Financial Corporation , Jupiter , Florida

The Fed concluded its meeting Wednesday announcing that [the fed funds rate] was left unchanged at 5.25 percent to 5.50 percent, with the door remaining open to another hike or two in 2023. Still committed to reaching the inflation target of 2.0 percent, they will remain steadfast to keeping interest rates higher longer than what was originally anticipated. The target rate of 2.0 percent isn’t expected to be reached until 2026. As inflation is the enemy to bond prices, the Fed is adamant to keeping it in check and ultimately this should lead to lower long-term interest rates, including mortgage rates. In the meantime, look for rates to take a bit of a breather. Next week is a data-packed week, including GDP and PCE data which can be a market-mover, so if you are floating an interest rate, be at the ready to lock it.

Greg McBride

CFA, chief financial analyst, Bankrate.com

The CPI didn’t tell us anything we didn’t already know, so the next big catalyst for movement in mortgage rates is the Fed meeting on Sept. 20.

Les Parker

CMB, managing director, Transformational Mortgage Solutions , Jacksonville , Florida

Mortgage rates go nowhere. Here’s a parody based on Jackson Browne’s 1977 classic, “Running On Empty”: “Running on (running on empty), Running on (running slow), Running bonds (running into data), But they’re running behind.” Analysts differ on where the U.S. economic cycle stands. Is this a recession, recovery, middle or late-cycle? Maybe it’s scrambled due to the global economic reactions to governmental reactions to the pandemic.

James Sahnger

Mortgage planner, C2 Financial Corporation , Jupiter , Florida

CPI came in today for the month of August at 3.6 percent which is far different than the 9.0 percent seen in June 2022. The increase from July came in large part to rising energy and housing costs. If you remove the volatile energy prices, overall inflation is closer to the Fed’s target rate of 2.0 percent. With next week being light of economic news, rates should remain rangebound.

Sean P. Salter, Ph.D.

Associate Professor of Finance and Dale Carnegie Trainer, Middle Tennessee State University , Murfreesboro , TN

Unchanged. The 10-year Treasury yield is up over the past 14 days, and mortgage rates should follow; however, mortgage rates were slightly down this week. I think that’s a signal of what’s happening on the origination side. We’ve heard reports that mortgage applications are at a 28-year low, so demand for mortgages is abysmal. I attribute lower mortgage rates to mortgage originators trying to gin up business — making a little less money is better than making none, but there’s a limit to how low mortgage rates can go while overall rates are still rising. Mortgage rates may wiggle a little one way or the other, but I think they’ll be basically unchanged this week.