What's Happening?
The Federal Reserve has maintained its interest rates steady, which has influenced mortgage rates to slightly decrease. As of February 13, 2026, the average rate on a 30-year fixed mortgage has dropped
to 6.09%, down from 6.11% the previous week. This decline in mortgage rates is attributed to strong economic growth and a solid labor market, which have improved housing affordability. The 10-year Treasury yield, which closely tracks mortgage rates, hovered around 4.1%. Despite the slight decrease in rates, the housing market remains stable but not significantly invigorated, as inventory growth has slowed, leaving total supply below pre-pandemic levels. Existing home sales have also dropped to their lowest level in over two years, with a seasonally adjusted annual rate of 3.91 million units in January.
Why It's Important?
The Federal Reserve's decision to keep interest rates steady has significant implications for the U.S. housing market and broader economy. Lower mortgage rates can enhance housing affordability, potentially stimulating home buying activity. However, the current rates are not low enough to attract a new wave of buyers and sellers, which is necessary to fully reignite the housing market. The decline in existing home sales indicates a challenging environment for homebuyers, exacerbated by limited inventory and rising house prices. This situation affects economic stakeholders, including real estate agents, homebuilders, and prospective homebuyers, who may face difficulties in navigating the market.
What's Next?
Looking ahead, the Federal Reserve's future decisions on interest rates will be closely monitored, as they could further impact mortgage rates and the housing market. If the Fed decides to adjust rates in response to economic indicators, it could either stimulate or dampen housing market activity. Additionally, stakeholders in the housing market will need to address the inventory shortage to meet demand and stabilize prices. The potential for long-term Treasury yield increases due to inflation concerns may also influence the Fed's balance sheet reduction plans, affecting the broader economic landscape.
