November 2025 to November 2026
If you’re thinking about buying a home or refinancing your current mortgage, you’re probably wondering what will happen to interest rates over the next year. It’s a question I get asked all the time, and with good reason! Prices have been a rollercoaster over the last few years. Right now, at the end of October 2025, we are seeing the average 30-year fixed mortgage rate is a little lower than at the beginning of the year, hovering around 6.17%. While it’s a welcome drop from the highs we saw near 7%, it’s still quite a bit higher than those super low rates from a few years ago. So what’s in store for mortgage rates between November 2025 and November 2026? The good news is that most signs point to a gradual easing, but it won’t be a straight fall. Mortgage rate predictions for the next 12 months: November 2025 to November 2026 What is driving mortgage rates right now? Before we look into the crystal ball, let’s quickly look at what influences mortgage rates. today. Think of mortgage rates as being connected to a bunch of different economic factors, kind of like how your mood can be affected by how many hours you slept, what you ate, and what’s happening at work. The movements of the Federal Reserve: You’ve probably heard about the Federal Reserve cutting interest rates. They recently made a 0.25% cut, lowering its main rate. This is good because it makes borrowing money cheaper for banks, and that can will eventually pass through to mortgage rates. The outlook is for a couple more cuts in 2025 and perhaps one in 2026. However, mortgage rates are more closely tied to long-term borrowing costs, not just the Fed’s short-term rates. Treasury Returns: This one is big. When people buy US Treasuries, especially 10-year ones, it’s a bit like the market is setting a benchmark for interest rates. At this time, these yields are around 4.1%. The best predictions suggest they will stay in a similar range, perhaps declining slightly, through 2026. This means rates probably won’t plummet, but they shouldn’t skyrocket either unless something unexpected happens. Inflation and the economy: Is inflation cooling? That’s the golden question! If prices continue to rise more slowly, the Federal Reserve has more room to cut rates, which usually means lower mortgage rates. We have seen some good signs, with inflation trending downward. The labor market also remains fairly strong, which is good for the economy but can sometimes prevent inflation from falling too quickly. It’s a balancing act. Real estate market things: Believe it or not, it also influences how many houses are for sale and how many people want to buy them. If there aren’t many homes available, prices can stay high and that can prevent mortgage rates from dropping significantly. A look into the future: November 2025 to March 2026 Over the next few months, through early 2026, I expect mortgage rates to mostly hold their breath. We will probably see them floating in the 6% midrange. Possible falls: If inflation continues to cool nicely and Treasury yields hold steady or even decline a bit, we may see rates creep lower toward 6.0% or 6.3%. Beware of surprises: However, things can change quickly. If there’s a surprise jump in inflation or some big news on the world stage (like new geopolitical tension), rates could get a little jittery and rise again. It will be important to keep an eye on the weekly reports. Looking beyond: April to November 2026 As we move into the second half of 2026, the picture is starting to clear up a bit and signs are leaning towards a gradual decline. The trend is going down (slowly): Most experts who study this topic predict that rates will likely drop to around 5.9% to 6.2% by the time November 2026 arrives. This is due to further anticipated interest rate cuts from the Federal Reserve and, hopefully, the continued cooling of inflation. Why not go down?: Even with these declines, it’s unlikely we’ll see a return to those super-low rates from the pandemic days anytime soon. Part of the reason is that there is still a shortage of homes for sale. When demand is high and supply is low, this tends to put a limit on how low prices and rates can go. Some economists believe rates may not fall comfortably below 6% until mid-2026. What the experts say: forecasts from key players It is always useful to see what the main organizations in the real estate and housing world are predicting. When you look at a few different groups, a general pattern emerges: Rates are expected to moderate, not plummet. Here’s a quick look at some of his predictions compiled from recent reports: Organization Forecast for the end of 2025 Average/final forecast for 2026 What you are seeing Fannie Mae (September 2025) 6.4% 5.9% (end of 2026) Stable economic growth, inflation around 2.7% Mortgage Bankers Association (MBA) (October 2025) 6.5% ~6.3% (average for 2026) Expect rates to stabilize; More mortgage loans are granted. National Association of Realtors (NAR) Average 6% (second semester average 6.4%) 6.0%–6.1% (average) Linked to increased home sales; a drop to 6% could boost sales. National Association of Home Builders (NAHB) N/A 6.25% (at the end of 2026) Focus on builder confidence; A gradual drop in the rate is expected. These are estimates, folks! They all depend on the economy behaving in a certain way. If the economy grows stronger than expected, rates could stay a little higher. If it slows more than expected, rates could fall faster. Looking back to see the future: historical context To get a real idea of where we’re headed, it’s helpful to see where we’ve been. Mortgage rates have been all over the place. Remember when they were close to 18% in the early 1980s? Or how they fell below 3% during the pandemic? Below are the average annual rates for a 30-year fixed mortgage: 2020: 3.11%
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