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Originally Published: Dec 22, 2020
Originally Published: Dec 22, 2020 Last Updated: Dec 28, 2020 8 min read
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Anyone who participated in the housing market in 2020 has been on a wild ride. Mortgage rates kept reaching new historic lows — 15 of them so far, to be exact — and home prices grew double-digits. All despite the economic turmoil caused by the COVID-19 pandemic.

Looking forward to 2021, will the new year be as wild as the one we’re leaving behind?

The consensus among four industry experts we spoke to is that mortgage rates are likely to rise from the current low of 2.67%, but they don’t expect a massive spike. Most experts are forecasting rates to stay close to their current historic lows early in the year and maybe rise as high as 3.4% by the end of 2021.

Likewise, home prices should continue to grow, although none of our experts are predicting growth as fast as this year’s. Instead, they expect median home prices to rise a maximum of 6%. The strongest price growth is likely during the first half of 2021, before moderating later on.

2021 Interest Rate and Home Price Growth Forecast Table
(Forecasts are averages for the year)
Company Mortgage Rates Home Price Growth
Freddie Mac* 3% 2.6%
MBA 3.3% 3%
NAR 3% 4%-6% 3.2%-3.4% 5.7%
*Forecast from October