Mortgage rates barely budge after Fed decision

The 30-year, fixed-rate remained near three-year lows

Lower mortgage rates are spurring borrower demand, according to data from the Mortgage Bankers Association. Above: Homes outside Chicago. (Brett Bulthuis/CoStar)

By Moira Ritter

January 29, 202612:44 PM ET

Key takeaways:

• Mortgage rates remain near three‑year lows, with the 30‑year fixed averaging 6.10% this week — down sharply from 6.95% a year ago.

• The Fed’s decision to hold interest rates steady isn’t expected to disrupt the mortgage market, as the move was widely anticipated and signaled continued focus on inflation over labor‑market concerns.

• Borrower activity surges: Refinance demand is up 156% year over year, and purchase applications have climbed 18%, signaling strong early‑2026 momentum amid easing home‑price growth and rising inventory.

Mortgage rate averages are near three-year lows for the third consecutive week. As of Thursday, the 30-year, fixed-rate mortgage averaged 6.10%, according to mortgage giant Freddie Mac. It's just one-hundredth of a percentage point higher than last week's average, and it's down from the year-ago average of 6.95%.

Though averages have increased on a weekly basis for the past two weeks, the 30-year, fixed-rate mortgage is still hovering near its lowest rate in roughly three years.

 

The 15-year, fixed-rate mortgage also increased slightly in the week ended Thursday, averaging 5.49%. It's still lower than the same time a year ago, when it averaged 6.12%.

On a daily basis, mortgage rates were similarly unchanged. Though daily measures of mortgages can be more volatile than weekly averages, as of Thursday afternoon, both the 30-year and 15-year fixed-rate mortgages were unchanged from a day earlier.

The 30-year, fixed-rate mortgage had settled at 6.16%, and the 15-year, fixed-rate mortgage was at 5.75%, according to Mortgage News Daily.

What this week's Fed decision means for rates

Thursday's mortgage market update comes a day after the United States' central bank announced it would keep short-term interest rates unchanged.

While the Fed doesn't set mortgage rates, its decisions — and economic forecasts — can send ripples through markets that can disrupt mortgages.

This week, though, the Fed's decision to leave interest rates unchanged was expected, so it's unlikely to create any meaningful change in the mortgage market, according to Brad Case, chief residential economist for Homes.com.

"That decision didn't surprise anybody, so there was no new information," he said in an email, noting that the bank also said it would not be buying mortgage-backed securities to bring down rates.

 

Case also added that the bank seems more concerned about inflation than the labor market; balancing those is part of its dual mandate.

"That means two things," Case said. "One, there's no reason to think that the Fed will cut their policy rate at an upcoming meeting unless conditions change, and two, markets don't need to be concerned that inflation may flare up again, which helps prevent an increase in mortgage rates."

Mortgage rates have already fallen this year

Even without a boost from the Fed, the mortgage market has already had a strong start to 2026.

Average mortgage rates are nearly a full point lower than the same time last year, and borrower demand is soaring past 2025's pace.

In the week ended Jan. 23, refinance demand was 156% higher than the comparable week in 2025, and purchase applications were up 18% over the same period of time, according to data from the Mortgage Bankers Association. Furthermore, the average loan size remained at the highest level since September.

The downward pressure on rates, combined with other trends in the broader housing market — namely, easing home price appreciation and increasing supply — has many economists and experts expecting an active year for transactions.

"The homes market had been out of whack since the COVID-19 pandemic shutdown, with unprecedented price increases," Case, the Homes.com economist, said. "We've seen that normalization process play out over the last few months of 2025, so I expect the spring of 2026 to look much more like 2018-2019, which was the most recent period of normalcy in the homes market."

WriterMoira Ritter

Moira Ritter is an award-winning staff writer for Homes.com, covering the California housing market with a passion for finding ways to connect real estate with readers' everyday lives. She earned recognition from the National Association of Real Estate Editors for her reporting on Hurricane Helene's aftermath in North Carolina.

Read Full Bio

for Moira Ritter