Mortgage rate history · 2021
Mortgage Rates in 2021
The 30-year fixed mortgage averaged 2.96% in 2021, ranging from 2.65% to 3.18% over the year. Here's where that sits in five decades of rates, how the year unfolded, the story behind it, and what it meant for a monthly payment and for how much home a buyer could afford.
- 2021 average (30-yr) 2.96% annual average
- Year's high 3.18% around December
- Year's low 2.65% around January
- 15-yr average 2.27% annual average
What happened to mortgage rates in 2021
Pandemic-era policy held rates at rock bottom — the 30-year fixed set its all-time low of 2.65% in January.
In 2021, the 30-year fixed-rate mortgage averaged 2.96%, ranging from a low of 2.65% to a high of 3.18% over the year, down from 3.11% in 2020. That made it the lowest annual average on record. For comparison, the 30-year fixed sits at about 6.49% today.
How 2021 unfolded
The 30-year fixed climbed through 2021, starting the year around 2.74% and ending near 3.10%. Within the year, rates peaked near 3.10% in December and bottomed around 2.74% in January. Here is the quarter-by-quarter average:
What a 2021 mortgage actually cost
A rate is abstract until it's a payment. Here's the monthly principal and interest a buyer in 2021 would have locked in at that year's average rate of 2.96%, across a few common loan sizes (30-year term):
Those are principal and interest only — taxes and insurance sit on top. At today's 6.49%, the same $200,000 loan runs about $1,263 a month, so 2021's rate was cheaper than today's. To price your own number, use the mortgage calculator.
What 2021's rate could buy
The flip side of the payment is buying power: at 2021's 2.96%, here's how large a 30-year mortgage a given monthly principal-and-interest budget would have supported — and what the same budget buys at today's 6.49%:
Lower rates stretch the same payment across a bigger loan, which is exactly why cheap-money years tend to push home prices up — buyers can finance more for the same monthly cost.
15-year vs 30-year in 2021
In 2021 the 15-year fixed averaged 2.27%, against 2.96% for the 30-year — a gap of 0.69 points. On a $300k loan, the 15-year payment would have been about $1,968 a month versus $1,258 for the 30-year: higher monthly, but far less interest over the life of the loan — roughly $54k versus $153k in total interest. The shorter term trades a bigger payment for tens of thousands saved.
If you bought a home in 2021
Looking back, anyone who locked a 30-year fixed in 2021 is sitting on a rate well below today's 6.49% — a strong reason to stay put rather than refinance. Either way, 2021's average of 2.96% is a useful yardstick against the 6.49% on offer now — and a reminder that the rate you lock is, for most buyers, a bigger long-run cost than the price you negotiate.
2021 in the bigger picture
Across the full 1971–2026 record, the 30-year fixed has averaged about 7.67%, so 2021 ran below that long-run norm. Within the 2020s, mortgage rates averaged roughly 5.4%, and 2021 sat below its own decade. Five years earlier, in 2016, the average was 3.65%. The following year, 2022, the average rose to 5.34%. Inflation drives mortgage rates — see what inflation did in 2021.
This is one year out of the whole story. For the complete history — every year since 1971, the all-time high and record low, the decade-by-decade view, and what drives rates over time — see historical mortgage rates, 1971–today.
Mortgage rates in 2021 — FAQ
What was the average mortgage rate in 2021?
The 30-year fixed-rate mortgage averaged 2.96% in 2021, based on Freddie Mac's weekly Primary Mortgage Market Survey. The 15-year fixed averaged 2.27%.
What were the highest and lowest mortgage rates in 2021?
In 2021 the 30-year fixed ranged from a low of 2.65% to a high of 3.18% — a swing of 0.53 percentage points across the year, peaking around December and bottoming around January.
Were mortgage rates high or low in 2021?
Measured against the full 1971–2026 record, 2021's 2.96% average was the lowest annual average on record, and below the long-run average of 7.67%.
How much was a mortgage payment in 2021?
At 2021's average rate of 2.96%, the monthly principal and interest was about $839 on a $200,000 loan and $1,258 on a $300,000 loan (30-year term, taxes and insurance not included).
Why were mortgage rates low in 2021?
Pandemic-era policy held rates at rock bottom — the 30-year fixed set its all-time low of 2.65% in January.
How do 2021 mortgage rates compare with today?
In 2021 the 30-year fixed averaged 2.96%, versus about 6.49% today — a difference of 3.53 points. On a $200,000 loan that is roughly $839 versus $1,263 a month in principal and interest.
