Mortgage Rates Hit Three-Year Low
Rates fell 22 basis points last week after Fannie Mae and Freddie Mac were instructed to buy $200 billion in mortgage bonds. The rate on a 30-year mortgage dropped to 5.99%, matching the low from February 2nd, 2023.
This type of purchase of mortgage-backed bonds usually lowers rates. During the first months of the Covid pandemic, the Federal Reserve purchased $580 billion in agency mortgage-backed securities and continued buying more throughout the year.
Analysts are currently busy predicting where mortgage rates could end up; most put the drop somewhere between 25 and 50 basis points, some even lower. However, this may not be enough to encourage more real estate transactions. Home prices are close to 50% higher than they were pre-pandemic, and inflation continues to challenge consumers.1
How Buyers Find Agents
According to a recent housing trends report, 36% of sellers found their agents through online channels during 2025 — more than double the 15% share in 2018. Among buyers, 33% say online research played a key role when choosing their agent.
In addition, the current housing market is led by repeat buyers who have been waiting for mortgage rates to fall. They're re-entering the market with a better understanding of its trends. Their priorities have changed, and their expectations are higher.
Zillow Home Trends expert Amanda Pendleton explained the repeat buyer mindset in more detail. "These 'comeback buyers' have lived through multiple market cycles. They've adjusted to today's rates; and they're intentional about who they hire, rewarding agents who show up with a clear strategy, strong process management and a truly modern, digital-first experience."
This means that to succeed in 2026, agents may need to adjust their online presence to appeal to digitally savvy prospects and existing clients. Repeat buyers expect their agent to provide efficient service, plus strategic guidance.
- 63% of repeat buyers ranked organizing and submitting paperwork as the most valuable agent service.
- 50% of buyers prefer texting or messaging apps when working with agents, while only 33% prefer phone calls.
Plans For More Affordable Housing Announced
Last week, President Trump proposed two policies aimed at lowering the cost of buying a home. In addition to Fannie and Freddie's purchase of $200 billion in mortgage bonds, a ban on institutional investors that would prevent them from buying single-family homes has also been suggested.
This isn't the first time politicians have wanted to ban large investors from buying residential homes. The End Hedge Fund Control of American Homes Act of 2023 was introduced by Rep. Adam Smith (D-Washington) and Sen. Jeff Merkley (D-Oregon). The Act states that investor property purchases have made it difficult for working-class Americans to buy a home.
However, banning big investors from buying homes may not make much of a difference. Research by the American Enterprise Institute found that these investors only account for around 1% of the total single-family housing stock.
Even lower mortgage rates, while bringing costs down for buyers, may not be a long-term fix. Gennadiy Goldberg, head of U.S. rates strategy for TD Securities, commented: "If consumers are able to afford more homes because monthly payments are lower, home prices tend to rise more quickly. So simply lowering the cost of buying a home through the mortgage channel isn't sufficient to fix the problem in the long run."3
Make Sure You Weren't a Victim of Holiday Credit Card Fraud
Now that the December holiday season is over, it's a good time to make 100% sure that you or a family member weren't a victim of credit card fraud. Scammers don't celebrate the holidays by spending time with their families; instead, they're attempting to take advantage of a busy shopping month. Last year's were busier than ever, according to credit card issuer Visa, as they reported blocking 85% more potentially fraudulent transactions worldwide from Thanksgiving to Cyber Monday (five days!) in 2025 than during the same period a year ago.
Here are details of scams to look out for when reviewing your financial statements for late 2025:
- Review all credit card purchases, including the smaller ones. Fraudsters often use low-dollar purchases at fast food and similar retailers to confirm that the card is active. They may then sell the card number to another scammer, or attempt a large purchase.
- Fake online storefronts that pretend to be well-known retailers can fool even scam-savvy surfers. One way to identify these is to see if the web address (URL) changes when you click on a product. In addition, clearance pricing that seems to be good to be true...usually is.
- Shipping-related scams are sometimes tied to a fake storefront, delivering fake tracking numbers and delivery schedules to buyers. These create a lag between order placement and delivery, which buys them more time to scam.
Agents Share Their 2026 Expectations
In the survey, 37.5% of participants described the current market as a balanced one, which was up from 30% as of the third quarter. Most shared a positive outlook. Fully 77% of agents said they expect 2026 to be better than last year.
A Detroit agent described would-be buyers' reasons for delaying a home purchase. "Homeowners insurance, car insurance and utilities and medical insurance are the top objections that I hear when a buyer talks about buying."
Another agent found that many South Carolina buyers still saw the market as it was in 2008, while sellers are leaning more towards the mega-hot market of 2021 and 2022. This was causing what he described as "diametrically opposed mindsets."
However, most of the agents (92%) reported having at least one seller cut their price during the fourth quarter of 2025, compared with 89% during the third quarter of the year. Other sellers chose to delist their properties until warmer weather.
Cutting prices, however, is not all that palatable to sellers, and more agents reported they delisted properties during the fourth quarter of 2025 than during the third quarter.
As for the new year, despite the slow end to 2025, 67.8% of agents said they expected sales to improve in the first quarter. Some respondents said that they think consumers are getting used to current economic conditions.
"I think a lot of people are feeling a little bit more comfortable with the unknown," a North Carolina agent commented. "Sentiment has shifted from anxiety to cautious optimism."5
Sources: 1cnbc.com, 2zillow.mediaroom.com, 3cbsnews.com, 4empower.com, 5cnbc.com
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