Mortgage Interest Rates Forecast

Mortgage rates this week

Mortgage rates fell to their lowest level since October 2024, with the average 30-year fixed falling 17 basis points to 6.26% APR in the week ending Sept. 18, according to Zillow.

The Federal Reserve cut its key interest rate by a quarter point on Sept. 17, a move many had been expecting. For people watching the housing market, it felt like welcome news: potential buyers have been hoping for relief from high mortgage rates, and homeowners have been waiting for a chance to refinance.

Mortgage rates don’t move in lockstep with Fed decisions, but they often react to similar factors in the broader economy. In fact, rates had already dipped to their lowest levels in nearly a year before the Fed even made its announcement, though they ticked back up a little afterward as markets processed the news.

»MORE: Is now a good time to refinance?

September Mortgage Rates Forecast

The Fed’s decision shows just how tricky the current economic moment is. On one hand, the job market is softening, which makes cutting rates appealing to help businesses and workers. On the other, inflation is still a concern, and higher rates usually help keep prices under control. By choosing to cut, the Fed signaled it sees jobs as the bigger risk right now.

Still, Fed Chair Jerome Powell stressed that the future is uncertain, and mortgage experts agree: where rates go next will depend on upcoming economic data. It's not a guaranteed downward trend.