Mortgage rates are expected to go down a healthier amount in 2023, but that doesn't mean those eager to buy a home will find it any easier to make a purchase.

According to a forecast by Bankrate, the interest rate for a 30-year fixed-rate mortgage in the United States could drop to 5.25% by the end of 2023, a considerable decrease from the peak rate of 7.12% that hit in 2022. However, some experts also warn that while the new will be welcome to those looking to purchase a home because it means monthly payments will be reduced, it doesn't mean the process to get a home will be easier.

In an interview with CNBC, Greg McBride, chief financial analyst at Bankrate, shared that despite the dip, numbers still won't be as low as they were both during the earlier days of the pandemic (when rates hovered between 2-3%) and even beforehand, when rates ran between 3.95-5.34% on average, according to Rocket Mortgage. In addition, prices are not likely to come crashing down anytime soon due to the chronic undersupply of homes in the U.S. As such, Mcbride expects many to still remain on the sidelines.

In addition, it will be a while before a steadier rate is seen, as the number is directly tied to how the Federal Reserve is handling interest rates in response to inflation, which while decreasing, is still very high.

"With the Fed maintaining an aggressive posture and inflation still high, mortgage rates will roller coaster up and down during the first half of the year before a more substantive slide takes hold in the back half of 2023," McBride said.

Still, while some may still be sitting on the sidelines as they wait for the market to finally work in their favor, the news will be a welcome sign of relief to some of those who paused their search for a home as rates and prices both continued to skyrocket. According to Zillow, the current median value of homes in the U.S. is $357,544, while Bankrate reports that the current average 30-year fixed conventional mortgage loan rate is sitting at 6.52%. Using a mortgage calculator from Bankrate shows that with those numbers, the average monthly payment on a mortgage would sit at $2,112.00. If rates went down to 5.25%, those payments would decrease to $1,880.00.

The numbers are still considerably higher than where they stood when rates went to their historic lows of around 2.68%. At that average home value, a mortgage payment sat at $1,458.00.

Roofstock Bird
Roofstock is one of the first online real estate marketplaces that exclusively deals with single-family rentals. Roofstock