Just like last year, mortgage rates improved last month, and that trend is still intact heading into December. Why? The evidence is clear (for now): inflation is heading lower, and unless there is an unforeseen spike, the Fed is done raising interest rates.
Moving forward, the bond market is trying to determine when the Fed will start cutting interest rates, and right now, it appears the market thinks that will happen in Spring 2024. It’s important to keep in mind the market has been wrong before.
Opportunities And Risks For December 2023 Mortgage Rates
The biggest opportunity for December 2023 mortgage rates to improve will be on December 12th when the CPI report comes out. It’s also the biggest risk for mortgage rates!
If the report comes in as expected, there will probably be minimal impact on the long-term direction of mortgage rates. However, a much lower than expected report could push mortgage rates lower OR a much stronger than anticipated report could push mortgage rates higher.
December 2023 Mortgage Rate Forecast For California
Here are our latest December 2023 mortgage rate forecasts for California:
- 30-year fixed rates below 6.00%
- 20-year fixed rates below 5.875%
- 15-year fixed rates below 5.50%
Our December 2023 mortgage rate forecast is based on properties in California, a loan amount of $350,000, a primary home, excellent credit (740 or higher credit score), and a Loan-To-Value ratio below 60% (purchase transactions).
We may see days in which mortgage rates spike higher; however, overall, we believe there will be opportunities to lock a mortgage rate at or below these levels throughout the month of December.
Mortgage Rate And Payment Chart
Here is a quick reference guide to December 2023 mortgage rate possibilities in California (these are not quotes, just examples) and the payments associated with each level based on various conforming loan amounts. See our important disclosure below.
30-Year Fixed-Rate Mortgage
| Term | Loan Amount | Mortgage Rate | Payment |
| 30-year fixed | $322,000 | 5.875% | $1,904.75 |
| 30-year fixed | $422,000 | 5.875% | $2,496.29 |
| 30-year fixed | $522,000 | 5.875% | $3,087.83 |
| 30-year fixed | $622,000 | 5.875% | $3,679.36 |
Important disclosure: The above is not a mortgage rate quote, nor is it an offer to lend. It’s only a generic example of various mortgage rates, loan amounts, and payments. Our mortgage rate chart is meant to educate and inform our readers. The current mortgage rate market may be higher or lower than the examples listed in these mortgage rate charts. Also, mortgage rates can and often do adjust multiple times a day.
California Mortgage Calculator
Using a mortgage calculator to figure out your monthly payment is an essential part of buying a home in California or refinancing a current mortgage. Use our free mortgage calculator to help you determine what you can afford.
With our online mortgage calculator, you can also factor in your property tax amount along with your annual homeowner’s insurance amount with your monthly mortgage payment.
Our California mortgage calculator is free and easy to use.
And our mortgage calculator is especially helpful for those who want to impound their property taxes and property insurance into their monthly mortgage payment. If you have any questions about or California mortgage calculator, please don’t hesitate to ask.
Economic Calendar For December 2023
Here we cover the daily economic events that might impact December 2023 mortgage rates. After the report comes out, we’ll update the post with that information and comment on if there is a potential impact on the Mortgage-Backed Securities market and consumer mortgage rates.
To start things off, we have the following report:
- ISM Manufacturing report
- ADP Employment
- ISM Non-Manufacturing PMI
- BLS Employment report
Wednesday – December 27th:
- MBA Purchase Index: The MBA Purchase Index came in at (no report).
- MBA Refinance Index: The MBA Refinance Index came in at (no report).
Friday – December 22nd:
- Core PCE: The m/m Core CPI report came in at 0.1%, which was slightly below market expectations of 0.2%.
Thursday – December 21st:
- Unemployment Claims: Weekly Unemployment Claims were 205,000, 10,000 below market estimates. Continued claims were 1,865,000.
- GDP Q3: The GDP Q3 report came in at 4.90%, which was above the market’s expectation of 5.20%.
Wednesday – December 20th:
- MBA Purchase Index: The MBA Purchase Index came in at 149.6.
- MBA Refinance Index: The MBA Refinance Index came in at 437.6.
Thursday – December 14th:
- Unemployment Claims: Weekly Unemployment Claims came in at 202,000, which is 18,000 below market estimates.
- Retail Sales: The monthly Retail Sales report came in at 0.3%, which is much stronger than the -0.1% the market was expecting.
Wednesday – December 13th:
- MBA Purchase Index: The MBA Purchase Index came in at 148.7.
- MBA Refinance Index: The MBA Refinance Index came in at 445.8.
Tuesday – December 12th:
- CPI Report: The Core CPI m/m report came in at 0.3% which is what the market was expecting. Core CPI y/y came in at 4.00% (exactly what the market was expecting)
Friday – December 8th:
- Employment Report: The market was expecting the jobs report to show 180,000 jobs created; however the report came in higher (199,000 jobs created). The unemployment rate came in at 3.7% (the market expected 3.9%), and earnings came in at 0.4% increase (the market was expecting a 0.3% increase).
Thursday – December 7th:
- Challenger Layoffs: The Challenger Layoff report came in at 45,510, which is higher than last month’s report of 36,836.
- Unemployment Claims: Weekly unemployment claims came in at 220,000, and continued claims came in at 1,861,000.
Wednesday – December 6th:
- MBA Purchase Index: The MBA Purchase Index came in at 144.5.
- MBA Refinance Index: The MBA Refinance Index came in at 373.3.
- ADP Jobs Report: The market was expecting 130,000 jobs created, and the report came in at 103,000 jobs created.
Friday – December 1st:
- ISM Manufacturing PMI: Last month, the ISM Manufacturing PMI report came in at 47.6, and this month it came in at 46.7. December 2023 mortgage rates improved post report.
Mortgage-Backed Securities & Treasury Snapshot
December 1st – December 15th:
Mortgage-Backed Security UMBS 4.5 started trading at the 94.73 level, and the UMBS 5.0 coupon started at the 97.22 level. The 10y Treasury yield was at the 4.19% level.
At the end of the week, Mortgage-Backed Security UMBS 4.5 was at the 96.52 level, and the UMBS 5.0 coupon was nearing the 98.61 level. The 10y Treasury yield was at the 3.93% level.
December 16th – December 31st:
Mortgage-Backed Security UMBS 4.5 started trading at the 96.38 level, and the UMBS 5.0 coupon started at the 98.56 level. The 10y Treasury yield was at the 3.93% level.
At the end of the week, Mortgage-Backed Security UMBS 4.5 was at the 96.88 level, and the UMBS 5.0 coupon was nearing the 98.88 level. The 10y Treasury yield was at the 3.86% level.
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