When Britain voted to withdraw from the European Union in June, homeowners began to enjoy a season of low rates and excellent refinancing opportunities. Now, four months after Brexit, mortgage rates have begun to bounce back and approach pre-Brexit levels—but don’t worry! Their ascent is expected to be short-term and the numbers are still very reasonable.
According to a recent study by the Federal Home Loan Mortgage Corporation, the 30-year fixed rate has jumped 10 basis points in just two weeks. In comparison, the 15-year fixed rate average has grown 3 basis points in just one week. The five-year adjustable rate has undergone the same growth.
“This month, mortgage rates seem to be catching up to Treasury yields,” reported Sean Becketti, chief economist of Freddie Mac. This reported increase is due to “a bond market sell-off spurred by speculation about reduced stimulus from global central banks.”
Even with mortgage rates re-approaching pre-Brexit levels to match today’s treasury yields, there’s no reason to pause your homebuying process. It’s important to remember that buying your first (or second) home takes time, and rates are still much lower than they were this time last year. In fact, the nation’s mortgage rates are predicted to remain low, as the bond market continues to level off.