What Will Mortgage Rates Look Like in 2026 Under the Trump Administration?
Written by
Caitlyn Moorhead
Edited by
Gary Dudak
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There’s growing confusion in the housing market. Interest rates seem to be cooling, yet mortgage rates remain stubbornly higher than affordable for many people. However, some experts suggest it might be a good idea to start scrounging together a down payment so you are ready to strike when the market opens up and mortgage rates dip to a more acceptable level.
Here’s what to know, and what could continue to change under the Trump administration in 2026.
Mortgage Rates Outlook
There might be some good news on your real estate horizon as mortgage rate forecasts for 2026 generally predict a gradual decline, with most experts projecting the 30-year fixed rate will average between 6% and 6.5%. Home prices are also predicted to rise more slowly between 1% and 2% than wages, thus improving affordability.
Ultimately, rates are expected to dip slightly from 2025 highs, though not in an overly dramatic way offering more than some minor savings.
The Trump Administration vs. Your Mortgage Rates
The word “wildcard” often comes to mind when trying to predict the next move from The White House. The potential impact of the Trump administration’s economic policies — such as tariffs or pressure on the Federal Reserve — introduces volatility and could keep rates from falling further.
The administration’s policies are considered a common variable of unpredictability for the housing market and could influence these forecasts. Though President Trump has consistently pressured and advocated for the Fed to cut interest rates more aggressively, even suggesting a nominee’s willingness to cut rates could be a litmus test for the Fed chair position, it has not yet yielded the desired results. However, a Trump-led Fed might pursue a more aggressive rate-cutting approach, which could put immediate downward pressure on mortgage rates.
Don’t forget tariffs, as a variety of different imported goods being more expensive could lead to even higher inflation and increased homebuilding costs. Persistent inflation would likely keep mortgage rates elevated as the Fed’s primary mandate is price stability, but 2026 does not look to be getting the most stable of starts.
The One Big Beautiful Bill Act (OBBBA), passed in July of 2025, has potential tax cuts and spending plans that could increase the U.S. government’s debt burden. This may lead investors to demand higher yields on U.S. government debt, which would, in turn, put upward pressure on long-term interest rates and mortgage rates.
The Trump administration is also expected to pursue deregulation to encourage new home construction and increase housing supply. This could help stabilize or lower home prices, potentially counteracting some of the upward pressure from other policies.
Is There a Good Time To Buy a Home in 2026?
The bottom line is that a good time to buy a home is when your finances align, but generally, the market is expected to be more balanced this year, offering better affordability with potentially slightly lower mortgage rates. This may even be the beginning of a housing reset where incomes catch up to prices, making it ideal for first-time buyers to build equity, especially in the first half of the year, before more buyers jump in.
2026 offers a strong opportunity to enter the market, but focus on your personal readiness in terms of your credit and savings. Create a long-term plan rather than trying to time the exact bottom. As the market gradually shifts toward better balance and affordability, so should you in the new year.
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