Fannie Mae Sharply Raises Mortgage Rate Forecast for 2026 and 2027

Fannie Mae's August Housing Forecast projected the average 30-year mortgage rate at 6.5% for 2026 and 6.7% for 2027, a sharp upward revision from its July forecast, which had called for the rate to decline to 6.3% for 2026 before ending 2027 at 6.2%. The GSE now expects the 30-year rate to average 6.7% in Q3 and 6.8% in Q4 2026, followed by 6.8% in the first half of 2027 and 6.7% in the second half.
As of Aug. 19, the Mortgage News Daily 30-year rate stood at 6.72%, while the Freddie Mac rate was 6.67% for the week of Aug. 13. Fannie Mae had initially predicted a 6% average rate for both 2026 and 2027 in its January forecast, before raising projections following the U.S. and Israeli strikes on Iran at the end of February.
Other forecasters remain somewhat more optimistic. The Mortgage Bankers Association projects the 30-year rate will hold around 6.5% through 2026, 2027, and 2028, based on Freddie Mac data, while Wells Fargo's August forecast puts the rate at 6.55% in Q3 and 6.4% in Q4 2026, before easing to 6.3% by late 2027.
loanDepot Chief Investment Officer Jeff DerGurahian said expectations for a September Fed rate hike have fallen to roughly one in three, but noted that longer-term rates may stay in a holding pattern until investors see clearer evidence of slower growth and inflation.