Fannie Mae Sharply Raises 30-Year Mortgage Rate Forecasts Through 2027

Fannie Mae has significantly increased its mortgage rate projections, forecasting the average 30-year fixed mortgage rate to reach 7.4% in the fourth quarter of 2026 and average 7.5% throughout 2027. These figures mark substantial upward revisions from previous estimates of 6.8% and 6.7%, respectively. The upgrade follows hotter-than-expected inflation data, climbing 10-year Treasury yields, recent Federal Reserve interest rate hikes, and elevated energy prices. The 30-year fixed rate stood near 7.46% following the data release, while September pending home sales fell 8.5% year-over-year, pointing to persistent affordability headwinds.