Fannie Mae Lifts 2027 Mortgage Rate Forecast to 7.5% as Inflation Drives Yields Higher
Updated
Updated · CNBC · Oct 14
Fannie Mae Lifts 2027 Mortgage Rate Forecast to 7.5% as Inflation Drives Yields Higher
3 articles · Updated · CNBC · Oct 14
Summary
Fannie Mae now expects the average 30-year fixed mortgage rate to hit 7.4% in late 2026 and hold at 7.5% through 2027, up from prior forecasts of 6.8% and 6.7%.
A hotter-than-expected inflation report pushed bond yields higher, extending a sharp rise in mortgage rates since early September; Mortgage News Daily put the average 30-year rate at 7.46% on Tuesday.
The move also reflects broader pressure from stubborn inflation, the Fed's first rate hike in more than three years, and rising 10-year Treasury yields tied to higher oil prices and global economic worries.
Higher borrowing costs are already chilling housing demand: Zillow said pending sales fell 8.5% year over year in September, while mortgage demand keeps dropping as affordability and loan qualification worsen.