Mortgage Rates Drop to 6.2%: Will the Housing Market Finally Thaw in 2026?

NEW YORK — For the first time in weeks, there’s actual hope in the housing market.

Mortgage rates just dropped to 6.2%, the lowest we’ve seen since late October. And that’s got buyers who’ve been sitting on the sidelines wondering: Is now the time?

The 30-year rate fell by 12 basis points this week, according to Mortgage News Daily. Doesn’t sound like much, right? But when you’re talking about hundreds of thousands of dollars over 30 years, it’s kind of a big deal.

So what’s driving this? Federal Reserve rate cut expectations, mostly. Financial markets are betting the Fed will lower rates again next month. That’s pushing down the 10-year Treasury note, which mortgage rates basically follow.

Here’s the thing — even at 6.2%, rates are still higher than most people would like. But they’re way better than the near-8% rates we saw in fall 2023. And honestly? They might not get much lower anytime soon.

Fannie Mae thinks we’ll average 6% in 2026, maybe dropping to 5.9% by the end of next year. So if you’re waiting for 3% rates to come back, don’t hold your breath.

The good news? People are actually starting to buy again. Mortgage applications for home purchases jumped nearly 8% last week, especially for government-backed loans like FHA and VA.

Bottom line? The market’s not frozen anymore. If you’ve been waiting for rates to drop, this might be your window. Just don’t expect perfection.