Mortgage rates are currently stable, with the national average for a 30-year fixed mortgage at 6.16%, only slightly above its recent low. While mortgage rates have been gradually declining since May, they remain above 6%, and experts are uncertain about future reductions in 2026.
Factors that could lead to lower mortgage rates include proposals from government officials, such as President Trump’s push for Fannie Mae and Freddie Mac to purchase mortgage bonds to reduce the spread between mortgage rates and 10-year Treasury yields. Additionally, the Federal Reserve’s actions influence mortgage rates; after cutting the fed funds rate three times in 2025, any future cuts in 2026 may lead to lower mortgage rates, though reactions can vary, and past patterns show that rates may not always continue to fall post-cut.
Monitoring the 10-year Treasury yield is also crucial, as mortgage rates closely follow it. Currently, the yield is 4.18%, down from the previous year. The current spread between the 30-year fixed mortgage rate and the Treasury yield is lower than it was last year, which is one reason rates are currently lower.
In summary, while there are factors that could potentially lower mortgage rates, their actual movement in 2026 remains uncertain and dependent on various economic conditions and policy decisions.
