Fannie Mae raises forecast for 30-year mortgage rate to 7.5% in 2027 — CNBC

In the United States, Fannie Mae has raised its forecast for the average rate on 30-year fixed-rate mortgages: according to the new estimate, it will stand at 7.4% in the fourth quarter of 2026 and at 7.5% throughout 2027. CNBC reports.

In its previous forecast, Fannie Mae expected the rate to be 6.8% in the fourth quarter of 2026 and 6.7% in 2027. Thus, the estimate for next year was raised by 0.8 percentage points.

Current rates are rising

According to Mortgage News Daily, the average rate on a 30-year fixed mortgage stood at 7.46% on Tuesday. CNBC notes that it could have risen even further that day after the release of inflation data that came in higher than expected. Bond yields were rising against this backdrop.

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Mortgage rates have been rising noticeably since the beginning of September amid persistent inflation and a sell-off in the bond market. The Federal Reserve also raised its benchmark rate for the first time in more than three years. Although mortgage rates do not directly mirror the Fed's decisions, they respond to the central bank's expectations for further inflation.

Impact on the housing market

Mortgage rates generally correlate with yields on 10-year U.S. Treasury bonds. Their yields rose sharply due to higher oil prices and growing concerns about the global economy.

Higher rates have already affected the U.S. housing market. According to Zillow, the number of pending existing-home sales, measured by signed contracts, was 8.5% lower in September than a year earlier. Demand for mortgage loans also continues to decline as buyers face higher home prices and worsening affordability.