"Fannie Mae's September economic and housing outlook predicts a potential decrease in mortgage rates, with a projected drop to 5.9% by the end of 2026. This slight decrease from the current rate of 6.34% could have a significant impact on the housing market, encouraging more potential buyers to enter the market. But will it make enough of an impact to get potential homeowners off the bench to buy?"
"A 0.34% decrease in mortgage rates from 6.34% to 6% could save borrowers nearly $30,000 over 30 years on a $340,000 loan for a median-priced home. A further drop to 5.9% would result in additional long-term savings, totaling almost $40,000 over the life of the mortgage compared to a 6.34% rate. The Federal Reserve's interest rate cut and subsequent market reactions have influenced mortgage rate trends, with rates expected to potentially rise back to around 6.4% by the end of the year."
"The National Association of Realtors® anticipates that a 6% mortgage rate could lead to a substantial increase in home sales, with specific metro areas like Atlanta, Dallas, and Minneapolis benefiting the most. Inflation data, government actions, and the Federal Reserve's policy changes will play a crucial role in determining the future direction of mortgage rates and the housing market's overall health."
Fannie Mae projects mortgage rates could fall to 5.9% by the end of 2026, down from 6.34% currently. A 0.34 percentage-point reduction to 6% would save borrowers nearly $30,000 over 30 years on a $340,000 loan; a drop to 5.9% would increase savings to almost $40,000 over the loan's life. Federal Reserve rate decisions and market reactions have driven recent mortgage-rate movement, and rates may rebound toward 6.4% by year-end. A 6% rate could boost home sales in metros like Atlanta, Dallas, and Minneapolis. Inflation, government action, and Fed policy will shape future rates and housing-market health.
Read at SFGATE
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