Mortgage rates fall ahead of Christmas holiday

Mortgage rates fell again this week, mortgage buyer Freddie Mac said Wednesday.

Freddie Mac’s latest Primary Mortgage Market Survey, released Wednesday, showed the average rate on the benchmark 30-year fixed mortgage decreased to 6.18% from last week’s reading of 6.21%. 

The average rate on a 30-year loan was 6.85% a year ago.

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“The modest decline reflects a bond market that moved throughout the week – albeit within a tight range – following a mix of cooling and resilient macro signals,” said Realtor.com senior economist Jake Krimmel.

Mortgage rates are not directly affected by the Fed’s interest rate decision but closely track the 10-year Treasury yield. The 10-year yield hovered around 4.14% as of Wednesday afternoon.

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On Tuesday, the Bureau of Economic Analysis released its initial estimate of third-quarter GDP, which showed the economy grew at an annualized rate of 4.3% in the three-month period including July, August and September. That figure topped the expectations of economists polled by LSEG, who had estimated 3.3% GDP growth in the third quarter.

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And, last week, the government released the latest inflation and employment figures. 

The Bureau of Labor Statistics said on Thursday that the consumer price index rose 0.2% in November from the prior month, while it increased to 2.7% on a year-over-year basis. Both of the figures were cooler than the expectations of economists polled by LSEG, who projected a 0.3% monthly rise and a 3.1% year-over-year figure.

The Labor Department on Tuesday reported that employers added 64,000 jobs in November. The unemployment rate ticked up to 4.6% for November, the highest since September 2021.

Meanwhile, the average rate on a 15-year fixed mortgage rose to 5.5% from last week’s reading of 5.47%.

Krimmel said that inventory is higher than last year in most markets and buyers will enter the new year with a better rate environment than they experienced in the 2025 spring season.

“If mortgage rates can simply hold in this range – or move modestly lower – buyers are likely to see a noticeable increase in purchasing power next year, even amid lingering macro and Fed policy uncertainty,” he said. “It won’t take much improvement from here for 2026 to feel like a step forward after two slow housing years.”