2026 Mortgage Rate Outlook: What Buyers and Refinancers Can Expect

As we enter the second half of January 2026, mortgage rates have shown meaningful improvement from the higher levels of 2025, offering renewed hope for homebuyers and refinancers across the U.S. The average 30-year fixed-rate mortgage stood at 6.06% for the week ending January 15, according to Freddie Mac's Primary Mortgage Market Survey—down from 6.16% the prior week and significantly lower than the 7.04% seen a year ago. Daily snapshots from sources like Zillow and Mortgage News Daily have even dipped into the high 5% range, with some qualified borrowers securing offers around 5.90%–5.99%. This downward movement reflects cooling inflation, prior Federal Reserve actions, and recent policy developments injecting liquidity into the mortgage-backed securities market.

The recent dip has been particularly noticeable following announcements that Fannie Mae and Freddie Mac will purchase up to $200 billion in mortgage bonds, boosting demand for these securities and helping narrow the spread between Treasuries and mortgage rates. While rates remain volatile day-to-day, the trend points toward gradual easing rather than sharp drops. These levels already translate to meaningful monthly savings compared to rates above 7% from prior years, making 2026 a more favorable environment for many borrowers.

Current Rate Snapshot and Recent Trends

Freddie Mac's weekly average for the 30-year fixed-rate mortgage is 6.06%, with the 15-year fixed at 5.38% as of mid-January. These figures represent broad lender surveys for well-qualified borrowers with strong credit and solid down payments. Daily indices show more variability—Zillow reports national averages around 5.90% for purchases and slightly higher for refinances, while some lender quotes fall into the high 5s for top-tier applicants. This marks the lowest weekly average in over three years, signaling a shift from the elevated rates that stalled the housing market in 2024 and 2025.

The improvement stems from a combination of factors: persistent cooling in inflation (projected around 2.4% for the year), earlier Fed rate cuts creating a supportive backdrop, and stronger demand in the mortgage-backed securities market. Policy moves like the GSE bond purchases have contributed to recent declines, though short-term fluctuations remain possible with incoming economic data or policy news.

2026 Forecasts: Gradual Easing, But No Return to Pandemic Lows

Expert outlooks for the full year are cautiously optimistic, with most projecting averages in the low-to-mid 6% range rather than dramatic plunges. Fannie Mae anticipates the 30-year fixed averaging around 6% through much of 2026, potentially dipping to 5.9% by the fourth quarter if economic conditions cooperate. The Mortgage Bankers Association (MBA) sees rates holding closer to 6.4% throughout the year, with possible periods of temporary softness amid economic resilience and limited further Fed easing. Bankrate and other sources suggest averages around 6.1%, with potential lows in the mid-5% range if inflation continues to moderate or recession concerns prompt additional policy support.

While sub-6% averages appear achievable at times—especially later in the year—a sustained drop below 5% remains unlikely without major shifts like aggressive Fed cuts or deeper economic slowdowns. Upward pressures could come from persistent inflation, stronger growth, or policy changes affecting Treasury yields. Overall, the consensus points to stability in the 5.8%–6.5% band, making 2026 more buyer-friendly than recent years but not a return to the ultra-low rates of the early 2020s.

Implications for Buyers and Refinancers Nationwide

For prospective homebuyers, these levels unlock more purchasing power—especially in affordable markets across the country, where even modest declines can mean hundreds in monthly savings. On a $300,000 loan, dropping from 6.5% to 6.0% reduces principal and interest payments by roughly $100 per month, while further softening could add meaningful affordability. First-time buyers and those in competitive areas benefit most from the broader pool of qualified households that lower rates create, potentially leading to increased sales volume in spring and summer.

Refinancers with rates from 7%+ (common from 2023–2025) have strong incentives to act, as dropping into the mid-to-low 6% range could save thousands annually in interest. Shopping multiple lenders remains essential—individual offers vary widely based on credit, down payment, location, and loan type. Getting pre-approved now positions borrowers to lock in favorable terms amid ongoing fluctuations.

This is educational information only and not personalized financial advice. Mortgage rates change daily and depend on your credit profile, down payment, location, loan type, and other factors. Always consult a licensed lender for current, tailored quotes, and consider professional guidance before deciding to buy or refinance.

Rates show promising momentum for gradual improvement in 2026, supported by policy and economic factors, but expect volatility rather than a straight decline. If you're planning a home purchase or refinance this year, staying proactive could help you capitalize on the current environment.