Some or all of the mortgage lenders featured on our site are advertising partners of NerdWallet, but this does not influence our evaluations, lender star ratings or the order in which lenders are listed on the page. Our opinions are our own. Here is a list of our partners.
Mortgage rates this week
Rates on fixed-rate mortgages didn't change much in the week ending Feb. 29, because of a lack of market-moving news.
The 30-year fixed-rate mortgage averaged 6.96% APR, up five basis points from the previous week's average, according to rates provided to NerdWallet by Zillow. A basis point is one one-hundredth of a percentage point.
The 15-year fixed-rate mortgage averaged 6.19% APR, up one basis point from the previous week's average.
The 5-year adjustable-rate mortgage averaged 7.76% APR, down 10 basis points from the previous week's average.
Mortgage rates respond to a lot of economic factors. The most influential factors involve inflation and jobs. All week, the market was in wait-and-see mode, biding its time for the Federal Reserve's favored inflation measurement: the core PCE, or personal consumption expenditures, price index.
The January core PCE price index was released the morning of Feb. 29, and the numbers were as expected: 2.8% inflation over 12 months and 0.4% inflation compared with the previous month. But because this inflation reading was consistent with the forecasts, it seemed to have little effect on mortgage rates this time around.
With the 30-year mortgage stuck around 7%, prices are key to home affordability. The week brought mixed news on home prices: down for newly constructed houses and up year-over-year for resales of existing homes.
The median price of a new home was $420,700 in January, down 2.6% compared with 12 months earlier, according to the Census Bureau. It's apparent that homebuilders have responded to the affordability crisis by constructing less-expensive homes. In January, 15% of new houses were sold for less than $300,000; a year before, 11% were sold below $300,000.
Over the same period, the median resale price for an existing home went up 5.1%, to $379,100, according to the National Association of Realtors.
January was the first time in more than a year that existing home prices went up faster than wages, NAR chief economist Lawrence Yun said in a conference call for reporters. "I would say in the current environment, it's unhealthy. We don't want to see it," Yun said of the price increase. "But it is a testament to the housing shortage that we are facing in America."
February mortgage rates forecast
After falling three months in a row, mortgage rates might not change much in February. Markets will await clearer guidance from the Fed about the timing of its rate cuts this year.
What other forecasters say
Forecasters from the Mortgage Bankers Association and mortgage securitizer Fannie Mae expect mortgage rates to track the inflation rate downward this year. That prediction rests upon the assumption that the Fed will succeed in getting inflation under control. The Fed's goal is to maintain an inflation rate of 2%.