Mortgage Rates in 2023

What happened to mortgage rates in 2023

The Fed kept tightening to fight inflation, and the 30-year fixed climbed to its highest level since the early 2000s.

In 2023, the 30-year fixed-rate mortgage averaged 6.81%, ranging from a low of 6.09% to a high of 7.79% over the year, up from 5.34% in 2022. That made it the 25th-lowest of the 56 years on record. For comparison, the 30-year fixed sits at about 6.49% today.

How 2023 unfolded

The 30-year fixed climbed through 2023, starting the year around 6.27% and ending near 6.82%. Within the year, rates peaked near 7.62% in October and bottomed around 6.26% in February. Here is the quarter-by-quarter average:

What a 2023 mortgage actually cost

A rate is abstract until it's a payment. Here's the monthly principal and interest a buyer in 2023 would have locked in at that year's average rate of 6.81%, 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 2023's rate was pricier than today's. To price your own number, use the mortgage calculator.

What 2023's rate could buy

The flip side of the payment is buying power: at 2023's 6.81%, 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 2023

In 2023 the 15-year fixed averaged 6.11%, against 6.81% for the 30-year — a gap of 0.70 points. On a $300k loan, the 15-year payment would have been about $2,549 a month versus $1,958 for the 30-year: higher monthly, but far less interest over the life of the loan — roughly $159k versus $405k in total interest. The shorter term trades a bigger payment for tens of thousands saved.

If you bought a home in 2023

Looking back, 2023's rate is close to today's 6.49%, so for a 2023 borrower there is little to gain from refinancing at current rates. Either way, 2023's average of 6.81% 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.

2023 in the bigger picture

Across the full 1971–2026 record, the 30-year fixed has averaged about 7.67%, so 2023 ran below that long-run norm. Within the 2020s, mortgage rates averaged roughly 5.4%, and 2023 sat above its own decade. Five years earlier, in 2018, the average was 4.54%. The following year, 2024, the average fell to 6.72%. Inflation drives mortgage rates — see what inflation did in 2023.

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.