New York, February 25, 2026, 14:12 ET — Regular session
U.S. mortgage rates dipped for another session, with Bankrate reporting the average 30-year fixed coming in at 6.04% Wednesday, down from last week’s 6.19%. The 15-year fixed mortgage posted 5.45%, and the 5/1 adjustable-rate product — which resets after five years — stood at 5.34%. Selma Hepp, chief economist at Cotality, noted the Federal Reserve is taking “a cautious approach” on potential rate cuts in 2026. According to Bankrate, these are the lowest average mortgage rates seen since 2022. 1
The housing market heads into spring’s selling stretch light on inventory and with prices still elevated. Even a modest dip in rates can be the difference for buyers getting approved—or for owners deciding if selling makes sense right now.
Borrowers aren’t the only ones glued to the bond market—investors are just as focused. Even a slight move in Treasury yields can ripple into mortgage rates almost immediately, and the effect is spilling over into housing stocks.
Mortgage applications edged up 0.4% for the week, with the bulk of that gain coming from a jump in refinancing, according to the Mortgage Bankers Association. The Refinance Index climbed 4% and now sits 150% higher than the same week last year. Meanwhile, the Purchase Index slipped 5%. “Mortgage rates followed Treasury yields lower last week,” said Joel Kan, MBA’s vice president and deputy chief economist. 2
On Wednesday, the 10-year Treasury yield held near 4.05%, figures from Trading Economics show. Mortgage rates often track that yield, since it sets the tone for longer-term loans. Still, the spread can stretch when risk premiums rise. 3
Kansas City Fed President Jeffrey Schmid flagged the central bank’s hefty mortgage bond stash as a key reason home loan rates haven’t climbed further, estimating mortgage rates are “probably 75 to 100 basis points lower today than they would otherwise be.” One basis point equals one-hundredth of a percent. 4
Housing-related stocks bounced around. Lowe’s slid roughly 5% after the company’s 2026 outlook came up short of what analysts wanted—CEO Marvin Ellison pointed to “high interest rates” and described conditions as a “pretty unique environment.” Zak Stambor, an Emarketer analyst, read the cautious tone as a signal that “the road ahead may be uneven.” Home Depot, the larger player, stuck with its current annual guidance. 5
Homebuilder stocks lost ground as well, with the iShares U.S. Home Construction ETF dropping 3.4%. Shares of D.R. Horton, Lennar, and PulteGroup all slipped about 5%, according to Barron’s. 6
Still, a lower mortgage rate doesn’t solve everything. Economists caution that if federal borrowing keeps Treasury yields high, there’s only so much further mortgage rates can drop. And if inflation surprises to the upside, yields could climb again, dragging mortgage quotes higher—even if supply remains tight. 7
Traders are bracing for Friday, when January’s U.S. producer price index lands at 8:30 a.m. ET—a release with the potential to jolt Treasury yields. Once that’s out, focus will shift to the Fed’s March 17–18 meeting, searching for any sign that rate cuts might be back up for debate this spring. 8
