What happened to mortgage rates this week
The Freddie Mac 30-year fixed mortgage rate ticked slightly higher this week, rising 3 basis points to 6.22%, even as financial markets reacted to the Federal Reserve’s third consecutive rate cut. Treasury yields moved modestly lower following the Fed’s decision, with the 10-year yield slipping closer to the low 4% range, helping keep mortgage rates near their lowest levels in more than a year. That steadiness comes despite lingering uncertainty around economic data, much of which remains delayed following the recent government shutdown.
What it means for the housing market
While the Fed’s 25 basis point cut brings the federal funds rate down to a range of 3.5% to 3.75%, the policy decision itself is not a direct catalyst for lower mortgage rates. Instead, markets are focused on the Fed’s updated economic projections and the growing division among policymakers. Current conditions suggest that FOMC members expect rates may now be near a neutral level, and future cuts could require more evidence of economic cooling. As a result, mortgage rates may remain range-bound in the low 6% area rather than falling sharply.
Looking ahead, the Realtor.com 2026 Housing Forecast anticipates mortgage rates will remain broadly in line with today’s levels in 2026. While this is unlikely to deliver the sharp relief some buyers are hoping for, rates are expected to be low enough to help counterbalance continued, but modest, home price growth. This dynamic is expected to lower the typical monthly cost of homeownership in 2026 for the first time since 2020, with affordability improving as rising incomes bring the share of earnings needed to purchase a median-priced home back below the 30% threshold.
Overall, the housing market appears positioned for gradual improvement rather than a dramatic rebound. Stable mortgage rates, improving affordability, and slowly rising inventory should help lift home sales off recent lows in 2026, particularly in many of the county’s top housing markets. Still, near-term volatility remains possible as markets digest incomplete economic data and look to upcoming Fed communications for clarity on the pace and extent of future policy easing.
