The average 30-year fixed mortgage rate has recently dipped below 6.3%, down from highs above 7% earlier in 2025. While still higher than the 6.09% average from a year ago, the trend points to a gradual easing. Experts attribute the shift to cooling inflation and growing expectations that the Federal Reserve may slow or pause rate hikes.

Buyer Activity on the Rise

Even a modest decline in rates can improve affordability. A dip of just a few tenths of a point reduces monthly payments and expands the range of homes buyers can realistically consider. If rates stay in the low-to-mid 6% range, many sidelined buyers may reenter the market this fall—boosting open house traffic and intensifying competition in desirable neighborhoods.

Seller Benefits Ahead

For sellers, lower rates can mean faster sales and more offers, especially for well-priced homes. The NAR projects existing-home sales to rise 7%-12% in 2025 and 10%-15% in 2026, assuming rates continue to ease. At the same time, price growth is expected to be more measured—around 3% in 2025 and 3%-4% in 2026. While less dramatic than recent surges, this pace offers sellers an opportunity to realize gains in a more balanced, stable market.

Refinancing Trends

​​Homeowners are also responding. Nearly 47% of recent mortgage applications were for refinancing—the highest share since last October. Many are either lowering payments or tapping into home equity, showing how even small rate changes can influence financial decisions.

Outlook Through 2026

The outlook largely depends on the trajectory of mortgage rates. If inflation spikes again or policy shifts unexpectedly, borrowing costs could rise. But if current trends hold, buyers can expect more manageable payments, while sellers may benefit from stronger demand and sustainable price growth into 2026.