Lower borrowing costs could bring positive news for homebuyers, as mortgage rates in the United States have dropped to their lowest level in three and a half years.
The average 30-year fixed mortgage rate reported by Freddie Mac declined to 6.01% this week, compared with 6.85% a year earlier. This decline could improve buyers’ purchasing power by nearly 9%, or roughly $36,000, potentially supporting the spring homebuying season if the trend continues.
Rents have continued to decline for the 29th consecutive month, with the average rent across the 50 largest U.S. cities falling 1.5% in January 2026 compared with the previous year. The decrease is linked to rising vacancy rates following improvements in the rental housing sector, as most markets are now experiencing a more balanced environment between tenants and landlords.
December data on new construction showed an increase in multifamily housing development, even as single-family home construction declined compared with 2024. The multifamily segment managed to offset some of the broader slowdown, particularly in the Northeast region.
Regarding existing homes, pending home sales fell by around 1% in January, affected by weaker buyer activity and winter weather conditions. Regional performance varied, with declines in the Northeast and Midwest, while more modest gains were recorded in the South and West. Despite this, new property listings began to rise for the first time in weeks.
The median asking price for homes on the market also continued to decline, which could help bring some buyers back into the market—especially alongside lower mortgage costs. These developments point to a potential improvement in affordability and a possible increase in home sales during the upcoming spring season.
