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Will interest rates go up in 2021? That’s the $64,000 dollar question. It depends on who ask. Typically rates do experience an uptick after a presidential election but I wouldn’t expect a dramatic rise in the new year.

According to Fannie Mae, rates for the 30-year fixed loan will remain at 2.8% through 2021 and only rise to 2.9% for 2022.

That is great news for buyers, especially first time homebuyers. Of course, this is only speculation. It doesn’t necessarily means that rates will indeed remain under 3%. They could go up.

Conversely, the MBA or Mortgage Bankers Association has a different view of things. They are predicting rates will go up in 2021 and 2022. The MBA is predicting the 30-year FRM will go from 2.9% in the current quarter to 3.3% one year from now and to 3.6% by the end of 2022.

That is a vastly different view than that of Fannie Mae. So who should you believe? Well that is up to you. It will be difficult to see what direction rates go in until after Inauguration Day. I still think we will see them go up but I do not think they will jump up substantially.

Bottom line. I do not see an increase like the MBA is talking about any time soon. That would be too big a jump. The housing market has been strong throughout the pandemic. I do not see the Federal Reserve jeopardizing a part of our struggling economy that has thrived by raising rates.

As always. Keep an eye on those rates if you are thinking of buying or selling and upgrading. It will factor into your decision making and how much you spend.