As of late August 2025, mortgage rates have hit a 10-month low, bringing a breath of fresh air to the housing market. This dip, coupled with solid economic growth, is seeing purchase demand start to climb. While many aspiring homeowners still grapple with affordability, these consistently lower rates offer a much-needed nudge to get them off the sidelines and into the market.

So, what’s the crystal ball showing for mortgage rates in 2025 and 2026? Based on insights from seven leading industry experts, it seems we can expect a gradual softening, though significant drops below 6% are unlikely in the immediate future.

I've spent years tracking the pulse of the housing market, and I can tell you that mortgage rates are the engine that drives so much of this activity. When they move, buyers and sellers react. It’s not just about the number itself, but what that number means for monthly payments and overall affordability. Let’s dive into what the experts are saying to help you navigate these important predictions.

Mortgage Rates Predictions by Top Industry Experts 2025-2026

Understanding the Current Climate: August 28, 2025

Before we look ahead, let's ground ourselves in where we stand today. According to the widely respected Primary Mortgage Market Survey®, as of August 28, 2025:

• 30-Year Fixed-Rate Mortgage (FRM): The average rate is hovering around 6.56%. This is a slight decrease of 0.02% from the previous week, and a 0.21% increase over the year. The monthly average sits at 6.59%, with a 52-week average of 6.69%. Looking at the 52-week range, rates have swung between a low of 6.08% and a high of 7.04%.
• 15-Year Fixed-Rate Mortgage (FRM): This option is pulling in at 5.69%. It’s seen no change from the previous week, but a 0.18% increase year-over-year. The monthly average is 5.71%, with a 52-week average of 5.85%. The 52-week range for this term is between 5.15% and 6.27%.

These numbers paint a picture of a market that’s stabilizing after a period of higher rates, offering some relief to buyers.

Comprehensive Mortgage Rate Forecasts: 2025-2026

To give you a clear overview, here’s a table summarizing the predictions from our seven leading industry experts. Keep in mind that these are forecasts, and the actual rates can fluctuate based on economic developments.

Breaking Down the Expert Opinions

It’s always fascinating to see the nuances in what these industry leaders are predicting. Here’s a deeper look at what they’re saying:

1. Wells Fargo: Steady as She Goes

Wells Fargo economists are taking a more cautious approach, predicting that mortgage rates will remain somewhat elevated. As of mid-2025, their outlook suggests rates will likely stay in the mid-to-high 6% range throughout 2025 and into 2026. They aren't anticipating a move below 6% in the near future.

Their forecast has seen some revisions, leaning towards rates staying higher for longer than previously thought. This indicates a focus on current economic indicators, suggesting that a robust economy might keep interest rates from falling too dramatically.

2. National Association of REALTORS® (NAR): The “Magic Bullet” Effect

Lawrence Yun, Chief Economist at the National Association of REALTORS®, views mortgage rates as a crucial factor for market activity. He anticipates that rates will average 6.4% in the latter half of 2025, with a further dip to 6.1% in 2026. Yun famously described mortgage rates as a “magic bullet” for the housing market, underscoring just how much their movement impacts buyer affordability and overall demand. I’ve seen this firsthand; when rates drop, even slightly, the phones start ringing off the hook with buyer inquiries. His optimistic outlook suggests that affordability will significantly improve in the coming year.

3. Realtor.com: Slow and Steady Wins the Race

Realtor.com’s housing forecast is also leaning towards a gradual easement of mortgage rates. They predict that average rates will match the prior year’s performance despite a dip to 6.4% by the end of 2025. This implies a more measured easing, suggesting that dramatic drops aren't on the immediate horizon, but a slow, consistent decline is more probable. This steady approach to rate reduction is often seen as more sustainable for the housing market.

4. Fannie Mae: Modest Upward Revisions, but Still Lower

Fannie Mae’s August 2025 forecast projects mortgage rates to end 2025 at 6.5 percent and 2026 at 6.1 percent, respectively. These are slight upward revisions from their July predictions, indicating a touch of caution. However, the overall trend still points towards a decline from current levels. The positive news from Fannie Mae also includes an expectation for mortgage originations to rise significantly, to $1.85 trillion in 2025 and $2.26 trillion in 2026, which is a strong indicator of a healthier housing market.

5. Mortgage Bankers Association (MBA): Volatility and Wider Spreads

The Mortgage Bankers Association highlights the ongoing volatility in interest rates, which has contributed to wider mortgage-Treasury spreads. Their forecast suggests a 30-year mortgage rate of 6.7% by the end of 2025, gradually declining to 6.5% by the end of 2026. They also anticipate times of limited refinance opportunities due to this volatility, which has led to higher refinance volumes this year compared to 2024. This is an important point for homeowners considering refinancing – timing and market conditions will remain key. Their outlook suggests a more cautious stance, factoring in the broader financial market environment.

6. Morgan Stanley: Lower Treasury Yields = Lower Mortgage Rates?

Strategists at Morgan Stanley, in their March 2025 outlook, predicted that mortgage rates could fall in tandem with Treasury yields. They also floated the idea of a slight decrease in home prices, potentially due to increased housing supply. The magnitude of any rate drop remains uncertain, but their 2026 outlook suggests that a slowing U.S. GDP growth could pull Treasury yields lower, and consequently, mortgage rates with them. This would significantly boost housing affordability. They illustrate this with a powerful example: a $1 million home costing $5,322 monthly at a 7% rate versus $4,925 at a 6.25% rate – that's a $397 monthly difference, a substantial saving.

7. Freddie Mac: Cooling of the “Lock-in Effect”

Freddie Mac’s Housing and Mortgage Market Outlook points to a significant factor impacting the market: the “lock-in effect.” Many homeowners with historically low mortgage rates from previous years have been hesitant to sell, afraid of taking on a much higher rate. Freddie Mac expects this effect to cool off in 2025. Even if rates remain flat or decline slightly, the natural amortization of mortgage balances will make it more palatable for homeowners to list their properties. This could lead to more inventory hitting the market, which, in turn, can help stabilize or even slightly reduce prices and provide more options for buyers. They also note that unlike last year when people anticipated rate declines and stayed put, this year, buyers and sellers might move earlier because they aren't expecting significant drops. This could boost sales activity relative to last year, though sales may still be below historical averages.

Putting It All Together: Key Trends and My Take

From where I stand, observing these predictions and the accompanying table, a few key themes emerge for mortgage rates in 2025 and 2026:

• Gradual Easing, Not a Steep Plunge: Most experts agree that rates will likely come down from any recent peaks, but we're not looking at a sudden dramatic drop below the 6% mark in the short term. Think of it more as a slow, controlled descent. The consensus seems to hover around the mid-to-high 6% range for late 2025, with the potential to dip into the low 6% range by 2026.
• Affordability as a Driving Force: The primary impact of these rate movements will be on buyer affordability. As rates soften, more people will be able to qualify for mortgages and afford higher-priced homes, which is a positive sign for market activity. The differential of a few tenths of a percent can mean thousands of dollars saved over the life of a loan.
• Economic Influences Remain Strong: Factors like GDP growth, inflation, and Federal Reserve policy will continue to be strong influencers. Any shifts in economic performance will be closely watched, as they can quickly alter rate trajectories.
• The “Lock-in Effect” is Fading: The easing of the homeowner “lock-in effect” is a crucial development. More sellers entering the market means more choices for buyers, potentially stabilizing prices and increasing transaction volumes. This is a natural market correction that benefits the overall health of the housing sector.
• Refinancing Opportunities: While volatility might create some uncertainty, there will likely be pockets of opportunity for refinancing, especially for those looking to lower their monthly payments or tap into equity. The MBA’s comment on this is particularly important for existing homeowners.

My personal take is that the market is finding a more sustainable rhythm. The wild, rapid swings of previous years are giving way to a more predictable, albeit still dynamic, environment. For buyers, this means it’s a good time to get serious about planning, understanding your budget, and getting pre-approved. The current rates offer a solid entry point for many who were priced out by higher rates. For sellers, if you’ve been on the fence due to the lock-in effect, now might be the time to consider listing your home as the market becomes more balanced and buyer demand continues to build.

What Does This Mortgage Rate Forecast Mean For You?

As you plan your homeownership journey, keep these expert insights and the summarized forecasts in mind. Mortgage rates are a powerful tool shaping the market, and understanding the predictions can give you a significant advantage. Whether you're buying, selling, or refinancing, staying informed is your best strategy.