“Mortgage rates are more likely to rise in the following months. Nevertheless, don’t expect any sharp spikes in August,” Nadia Evangelou, senior economist and director of forecasting for the National Association of Realtors in Washington, D.C., told Bankrate. “I expect mortgage rates to show little change in August, hovering around 3 percent as most economic indicators will start to normalize.”
Chuck Biskobing, a senior real estate attorney with Atlanta-based Cook & James, also shared the same sentiment with Bankrate.
“I expect rates to more or less hold steady for the next month in the 3 percent range for a 30-year mortgage. Given recent unexpectedly high jobless claims, I think a major move upward in rates is unlikely,” he notes. “Monthly inflation numbers are a bit of a wildcard, but overall I think rates will remain around current levels for the time being.”
Indeed, inflation and economic growth are the variables most at play right now, says Greg McBride, chief financial analyst for Bankrate.
“Ironically, they have both led to lower long-term rates. However, any hints of tapering bond purchases from the Federal Reserve would push mortgage rates up this month,” McBride adds. “How the debate about whether inflation is transitory or more sustained ends up being resolved is not yet known. But if these temporary factors yield to evidence that indicates higher inflation is embedded, we’ll see rates jump.”