Mortgage Rates Today, Dec. 3, 2024: Markets Still Face Mountains of Uncertainty
The average 30-year fixed rate mortgage is 6.68% today, a decrease of 0.05% since yesterday. The 15-year fixed mortgage rate stands at 5.78%, down by 0.02%. The 30-year FHA mortgage now averages 5.97%, having risen by 0.01. Meanwhile, the 30-year jumbo mortgage rate is 7.16%, reflecting a decrease of 0.01%.
In brief
Markets hate uncertainty. They work by anticipating and trading ahead of events.
And, when the future is so murky, they often panic. But, despite a mountain of uncertainty between them and their crystal ball, they're currently managing to hold it together.
That's remarkable because investors are reading about as broad a range of conflicting future scenarios as you can imagine.
This morning, The Financial Times said about the American economy: "The country’s outperformance is rooted in long-term productivity growth that is the envy of the developed world. Could Trump’s policies endanger its lead?"
Well, let's hope not. In its December forecast, Comerica Bank's economics team wrote yesterday:
"Comerica’s forecast ... raises the outlook for real GDP growth in 2025 and 2026. It also assumes that tariff rates increase. That lifts near-term growth of industrial production, contributes to higher prices of consumer and capital goods, and as a result raises inflation. The forecast also assumes that curbs on immigration slow the growth of the labor force (fewer immigrant workers). Solid economic growth and a tighter labor supply bring the unemployment rate back under 4% by mid-2025. ...
"If the economy evolves along these lines, the Fed will see less need to cut interest rates in 2025 than signaled in their September Dot Plot.
Comerica’s forecast sees the Fed cutting the Fed funds target three-quarters of a percent between Thanksgiving 2024 and the end of 2025."
However, Freddie Mac took a very different line in an e-newsletter yesterday, saying, " ... we forecast the mortgage market to improve in 2025, based on a decline in mortgage rates throughout the year."
Can Comerica and Freddie both be right? Maybe, in theory. Mortgage rates aren't directly tied to the rates the Federal Reserve controls. But it would be rare for them to diverge as far as Freddie implies.
And, last week, we brought you the latest mortgage rates forecasts from Fannie Mae and the Mortgage Bankers Association. Both thought those rates would fall next year but much more slowly than they'd previously forecasted.
Changes are afoot. But nobody seems to have much of an idea what they'll bring. And that applies both to the economy and mortgage rates.
Mortgage Rate Trends: Past 90 Days
Purchase Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.68% | 6.72% | -0.05% | -0.32% |
| 15-Year Fixed | 5.78% | 5.84% | -0.02% | -0.22% |
| 30-Year Fixed FHA | 5.97% | 6.8% | +0.01% | -0.36% |
| 30-Year Fixed VA | 5.97% | 6.12% | -0.02% | -0.38% |
| 30-Year Fixed USDA | 5.91% | 6.05% | -0.08% | -0.31% |
| 30-Year Fixed Jumbo | 7.16% | 7.18% | -0.01% | -0.18% |
| 5/6 Year ARM | 6.59% | 6.62% | +0% | -0.27% |
Refinance Rates
| Loan Type | Rate | APR | Daily Change | Monthly Change |
|---|---|---|---|---|
| 30-Year Fixed | 6.68% | 6.72% | -0.05% | -0.3% |
| 15-Year Fixed | 5.65% | 5.71% | -0.01% | -0.2% |
| 30-Year Fixed FHA | 5.95% | 6.78% | +0.01% | -0.37% |
| 30-Year Fixed VA | 5.97% | 6.12% | -0.02% | -0.39% |
| 5/6 Year ARM | 6.68% | 6.75% | +0% | -0.18% |
Coming up
All yesterday's economic reports came in appreciably more strongly than forecast. Yet mortgage rates only inched higher. Perhaps markets are distracted by the uncertainty described above.
Mortgage rates today
Today, we're due the October job openings and labor turnover survey (JOLTS). Markets are expecting a small increase in the number of job openings, up to 7.5 million (amended since yesterday) compared with September's 7.4 million. That would be good for mortgage rates because it suggests an easing in the labor market.
Market expectations are crucial to mortgage rates because investors typically trade ahead of reports based on them. So, good or bad news is fine, providing it's expected. It's when there's a gap between actual figures and expectations that mortgage rates tend to move.
November auto sales will emerge during the day as individual manufacturers release their figures. As these trickle out, we're unlikely to see a reaction reflected in mortgage rates today.
Three senior Federal Reserve officials have speaking engagements today. Markets will be keeping an ear open to hear any hints dropped about the likelihood of a Fed cut to general interest rates on Dec. 18.
Tomorrow
If markets are keeping an ear open today, they'll be glued to their live feeds tomorrow. That's because Fed Chair Jerome Powell will be speaking in public at lunchtime. Markets treat Powell's words with the reverence the ancient Greeks used to reserve for the oracle at Delphi. He's more than capable of moving markets and mortgage rates.
Tomorrow's main report is the ADP employment report, which covers private-sector payrolls in November. This is always a wait-and-see publication. Sometimes, markets see it as a bellwether for the much more important jobs report, due Friday. And sometimes they don't.
Markets are expecting the report to show 163,000 new jobs created in November, way down from October's 233,000. For mortgage rates to fall, we'd like to see a number below 163,000.
Other reports tomorrow include two November purchasing managers' indexes (PMIs) for the services sector and October's factory orders.
