Oregon Mortgage Rate Trends and Forecast for 2017

Oregon mortgage rate trends have brought some “drama” over the past few weeks. After months of relative stability, mortgage rates rose sharply during November.

Last month, the average rate for a 30-year home loan rose above 4% for the first time since 2015. And they’ve continued moving north since then. Here are the latest Oregon mortgage trends as of December 2016, with a forecast and outlook for 2017.

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Oregon Mortgage Rate Trends: The November Surge

During the second half of 2016, the average rate for a 30-year fixed mortgage loan hovered at or below 3.5%. Then came November. Following the presidential election, mortgage rates began a steep upward climb unlike anything we’ve seen all year.

The chart below shows mortgage rates trends from November 2015 to November 2016, for three common loan categories. The spike on the far right is where we are now, at the start of December. This chart also shows that current rates (as of December 1, 2016) are the highest they’ve been all year.

Mortgage rate chart, December

National mortgage rate trends for the last 12 month. Source: Freddie Mac PMMS.

The day this chart was released, Freddie Mac’s economists wrote: “The 10-year Treasury yield remained flat despite an upward revision to third quarter GDP. The 30-year mortgage rate rose 5 basis points to 4.08 percent, rising a total of 51 basis points in three short weeks.”

Oregon home buyers who are planning to buy a home in the near future should pay close attention to these mortgage rate trends, especially since home prices are also rising across the state.

Related: Oregon real estate forecast for 2017

Market Shifting Toward Purchase Loans

When mortgage rates rise sharply, refinancing activity tends to drop off. That’s what we are seeing now. Recent mortgage rate trends in Oregon have caused a drop in the number of refinance loans.

The latest Weekly Applications Survey results from the Mortgage Bankers Association showed a 16% drop in refinancing activity this week, compared to last week.

Housing analysts and economists have predicted that in 2017, mortgage activity will be “purchase heavy” with a lower percentage of refinance loans. This is logical, since rates are expected to inch upward through 2017.

Forecast for 2017: Gradually Rising Rates

What can we expect from Oregon mortgage rates in 2017? According to at least two expert sources, rates will likely rise gradually over the next 12 months or so.

In its latest forecast, published in November 2016, the Mortgage Bankers Association predicted that the average rate for a 30-year home loan would reach 4.4% by the fourth quarter of 2017.

In a statement from November 30, 2016, Freddie Mac’s economic team stated: “We expect that interest rates will have more modest increases in store and that mortgage rates throughout 2017 will be significantly higher than what we thought last month.”

Related: Oregon mortgage loan programs

Get Pre-Approved for a Home Loan

Do you plan to buy a home in Oregon sometime soon? Do you need a loan to help finance your purchase? We can help. Sammamish Mortgage has proudly served the Pacific Northwest for more than 20 years. We offer a variety of loan options including both FHA and conventional.

If you’re ready to start shopping for a home, we can pre-approve you for a loan to make you a more competitive buyer. We can also give you a mortgage rate quote based on the type of loan you need. Have questions about your financing options? We can answer those too! Please contact our friendly, knowledgeable staff to get started.

Note: Oregon mortgage rate trends and forecasts were provided by third parties not associated with our company. We have gathered and presented them here as an educational service to our readers.