Mortgage rates spent much of 2025 parked in the upper-6% range, held in place by persistent inflation pressures and a cautious Federal Reserve. That began to shift late in the year as the Fed signaled it was ready to ease policy. Rates slipped ahead of the September 2025 rate cut, the first of the year, and then drifted lower again before the October meeting before continuing their gradual decline as markets anticipated further action.
At the close of its in December meeting, the final one of the year, the Fed delivered another 25-basis-point cut, bringing the federal-funds rate down to a range of 3.50% to 3.75%. It’s the third consecutive meeting with a rate reduction and a clear sign that policymakers believe inflation is moving sustainably toward their target.
Mortgage rates have softened alongside these moves, though not as dramatically as borrowers might hope. The average 30-year fixed mortgage rate recently ticked down to about 6.2%, slipping from the mid-6% range earlier ithis fall. While that’s still well above the unusually low rates seen a few years ago, it marks meaningful progress from the roughly 7.05% peak reached in January 2025. But as the Fed continues easing and bond market conditions stabilize, will mortgage rates see additional downward pressure? Here’s what experts say.