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Mortgage Rates Fall Below 6% for First Time Since 2022

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  Published in House and Home on Thursday, February 26th 2026 at 15:08 GMT by CBS News
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Thursday, February 26th, 2026 - After a prolonged period of financial strain for prospective homebuyers, mortgage rates have finally fallen below the 6% threshold, reaching 5.99% as of today, according to Freddie Mac. This marks the lowest level seen since September 2022, offering a glimmer of hope to a market that has been largely sidelined by affordability concerns.

The decline is directly linked to a recent moderation in inflation. January's Consumer Price Index (CPI) report revealed a slower-than-anticipated increase in prices, prompting investors to revise their expectations regarding the Federal Reserve's monetary policy. The market is now increasingly anticipating that the Fed will begin to lower interest rates sooner than previously projected - a move that would directly translate to lower mortgage rates.

"The market is reacting strongly to the cooling inflation data," explains Zillow economist Jeff Tucker. "Mortgage rates are incredibly sensitive to perceived shifts in the Federal Reserve's likely course of action. This is a classic case of expectations driving market behavior."

However, experts warn against assuming a sustained period of low rates. Economic indicators remain volatile, and future inflation reports, employment data, and geopolitical events could easily push rates back upwards. The Federal Reserve, while seemingly leaning towards easing, will remain data-dependent, meaning any unexpected surge in inflation could halt or reverse the anticipated rate cuts.

A Year of Fluctuations and the Road to 5.99%

The current dip represents a significant change from the upward trajectory of rates observed throughout much of 2023 and early 2024. Looking back, the fluctuations provide a stark illustration of the market's sensitivity to economic news:

• January 2024: 6.61%
• December 2023: 7.44%
• November 2023: 7.49%
• October 2023: 7.63%
• September 2023: 7.13%
• August 2023: 6.70%
• July 2023: 6.81%
• June 2023: 6.61%
• May 2023: 6.43%
• April 2023: 6.31%
• March 2023: 6.54%
• February 2023: 6.66%
• January 2023: 6.13%

Impact on the Housing Market: A Double-Edged Sword

The decrease in mortgage rates is undoubtedly positive news for potential homebuyers who have been priced out of the market. Lower rates reduce the monthly cost of borrowing, increasing affordability and potentially boosting demand. This could be particularly beneficial for first-time homebuyers, who are often most sensitive to interest rate changes.

However, a significant obstacle remains: the persistent lack of housing inventory. For months, the number of homes available for sale has remained near historic lows, driving up competition and keeping prices elevated. Even with lower rates, buyers may still face bidding wars and limited choices, especially in desirable locations.

"Lower rates will certainly inject some energy into the market," Tucker notes. "But inventory is the key. If we don't see a substantial increase in the number of homes for sale, any gains in affordability will be quickly offset by rising prices."

Looking Ahead: What to Expect in the Coming Months The future of mortgage rates remains uncertain. While the current trend is encouraging, several factors could influence the market in the coming months. These include:

• Federal Reserve Policy: The Fed's decisions regarding interest rate cuts will be paramount. The timing and magnitude of any cuts will heavily influence mortgage rates.
• Economic Data: Ongoing inflation reports, employment figures, and GDP growth will provide clues about the health of the economy and the Fed's likely response.
• Housing Inventory: A significant increase in housing supply is crucial to stabilize prices and create a more balanced market. Construction activity, existing homeowner decisions to sell, and government policies could all play a role.
• Global Economic Conditions: International events and economic trends can also impact U.S. interest rates.

For potential homebuyers, the current environment presents a window of opportunity. While rates are still subject to change, the dip below 6% provides a more favorable starting point than seen in over a year. However, it's essential to shop around for the best rates, get pre-approved for a mortgage, and be prepared to act quickly in a competitive market.