What was the average 30-year mortgage rate in 1979?

The average 30-year fixed mortgage rate in 1979 was 11.20%, according to Freddie Mac's Primary Mortgage Market Survey (PMMS). This was 1.56 percentage points higher than the 9.64% average in 1978.

How much was a mortgage payment in 1979?

At the 1979 average rate of 11.20%, the monthly principal and interest payment on a $300,000 30-year fixed mortgage would have been approximately $2,902. At today's average rate of 6.84%, the same mortgage costs $1,964/month.

What caused mortgage rates in 1979?

Paul Volcker was appointed Federal Reserve Chairman in August 1979 and immediately pivoted to aggressive monetarism. He abandoned federal funds rate targeting in favor of controlling money supply, allowing rates to spike sharply. CPI hit 11.3% as the Iranian Revolution caused a second oil shock. Gasoline lines returned, consumer confidence collapsed, and the "misery index" (inflation + unemployment) reached record levels.

← 1978 (9.64%)1980 (13.74%) →

📊 Historical Mortgage Data · Source: Freddie Mac PMMS

Mortgage Rates in 1979

Second oil shock; Volcker appointed Fed Chair

11.20%

Annual avg rate

30-yr fixed

+1.56pp

vs 1978

Year-over-year

11.20%

Fed funds rate

Annual avg

+11.25%

CPI inflation

Year-over-year

Estimated Monthly Rate Trend — 1979

Estimated monthly rates based on annual averages and adjacent-year interpolation. Seasonal pattern reflects typical mortgage market spring/summer premium.

Low: 10.45%High: 12.28%Avg: 11.20%

1979 in Context — Surrounding Years

Year	30-Yr Rate	Fed Funds	Inflation
1975	9.05%	5.82%	+9.14%
1976	8.87%	5.05%	+5.74%
1977	8.85%	5.54%	+6.50%
1978	9.64%	7.93%	+7.63%
▶ 1979	11.20%	11.20%	+11.25%
1980	13.74%	13.35%	+13.55%
1981	16.63%	16.38%	+10.33%
1982	16.04%	12.26%	+6.13%
1983	13.24%	9.09%	+3.22%

Economic Context in 1979

🏦

Federal Reserve Policy

Paul Volcker was appointed Federal Reserve Chairman in August 1979 and immediately pivoted to aggressive monetarism. He abandoned federal funds rate targeting in favor of controlling money supply, allowing rates to spike sharply.

📈

Inflation Environment

CPI hit 11.3% as the Iranian Revolution caused a second oil shock. Gasoline lines returned, consumer confidence collapsed, and the "misery index" (inflation + unemployment) reached record levels.

🏠

Housing Market Impact

Mortgage rates surged past 10% to 11.2% by year end. Housing activity slowed dramatically. Adjustable-rate mortgages began gaining popularity as lenders sought protection from rate volatility.

What Did a 1979 Mortgage Cost? ($300,000 Loan · 30 Years)

$2,902/mo

At 1979 rate (11.20%)

Principal + interest only

$1,964/mo

At current rate (6.84%)

Principal + interest only

$939/mo

1979 was more expensive

vs today on same loan

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Disclaimer: Rates shown are historical averages. Actual mortgage rates vary by lender and borrower profile. Monthly rates are estimated from annual averages and are for illustrative purposes only. Data is for educational purposes only and does not constitute financial advice. Source: Freddie Mac Primary Mortgage Market Survey (PMMS), Federal Reserve FRED, and BLS CPI-U.

← 1978 (9.64%)1980 (13.74%) →

📊 Historical Mortgage Data · Source: Freddie Mac PMMS

Mortgage Rates in 1979

Second oil shock; Volcker appointed Fed Chair

11.20%

Annual avg rate

30-yr fixed

+1.56pp

vs 1978

Year-over-year

11.20%

Fed funds rate

Annual avg

+11.25%

CPI inflation

Year-over-year

Estimated Monthly Rate Trend — 1979

Estimated monthly rates based on annual averages and adjacent-year interpolation. Seasonal pattern reflects typical mortgage market spring/summer premium.

Low: 10.45%High: 12.28%Avg: 11.20%

1979 in Context — Surrounding Years

Year	30-Yr Rate	Fed Funds	Inflation
1975	9.05%	5.82%	+9.14%
1976	8.87%	5.05%	+5.74%
1977	8.85%	5.54%	+6.50%
1978	9.64%	7.93%	+7.63%
▶ 1979	11.20%	11.20%	+11.25%
1980	13.74%	13.35%	+13.55%
1981	16.63%	16.38%	+10.33%
1982	16.04%	12.26%	+6.13%
1983	13.24%	9.09%	+3.22%

Economic Context in 1979

🏦

Federal Reserve Policy

📈

Inflation Environment

CPI hit 11.3% as the Iranian Revolution caused a second oil shock. Gasoline lines returned, consumer confidence collapsed, and the "misery index" (inflation + unemployment) reached record levels.

🏠

Housing Market Impact

Mortgage rates surged past 10% to 11.2% by year end. Housing activity slowed dramatically. Adjustable-rate mortgages began gaining popularity as lenders sought protection from rate volatility.