FAQ: Are mortgage rates going to move lower in 2026?

Rates are likely to ease somewhat, given the downtrend in inflation and a modest uptrend in unemployment. That said, data surprises, global events, investor confidence, and the Federal Reserve’s rate decisions could easily push rates in the opposite direction.

Everyone wants a simple answer on rates, but the reality is more complex. While modest improvements are possible, sharp drops could reignite buyer demand and put upward pressure on home prices. That’s why timing and strategy often matter more than trying to predict the “perfect” rate.

Even if rates do decline, affordability will still depend on your local housing market and personal circumstances. In some high-demand areas, even small rate cuts might not make a home significantly more affordable if prices continue to climb. Conversely, buyers in regions with more balanced supply and demand could benefit from lower rates without seeing the same upward pressure on prices.

Understanding your financial goals and local market conditions are often more important than chasing the lowest possible rate.