US mortgage rates drop below 6% for the 1st time in nearly 4 years
In an aerial view, two-story single family homes line the streets of neighborhood on January 13, 2026 in Thousand Oaks, California. (Kevin Carter/Getty Images)
(NEW YORK) — The rate on a 30-year fixed mortgage dropped below 6% for the first time in nearly four years, according to new data from Freddie Mac.
Rates have been hovering around 6% this year and averaged 6.76% last February.
“For the first time in three and a half years, the 30-year fixed-rate mortgage dropped into the 5% range, falling even lower than last week’s milestone,” Sam Khater, Freddie Mac’s chief economist, said in a statement. “This rate, combined with the improving availability of homes for sale, is meaningful and will drive more potential buyers into the market for spring homebuying season.”
This is a developing story. Please check back for updates.
President Donald Trump attends the signing ceremony of the Peace Charter for Gaza as part of the 56th World Economic Forum in Davos, Switzerland on January 22, 2026. (Harun Ozalp/Anadolu via Getty Images)
(NEW YORK) — Mortgage rates whipsawed in recent weeks as markets reacted to a flurry of policies from the Trump administration.
It began with a major milestone. Mortgage rates earlier this month fell below 6% for the first time in nearly three years, according to a data released by Mortgage News Daily.
“The progress stems directly from President Trump’s aggressive agenda to restore the American Dream of homeownership,” the White House touted in a statement on Jan. 12. The Trump administration cited its announcement days earlier, calling on government-sponsored mortgage lenders to purchase $200 billion in mortgage-backed securities.
Within little more than a week, however, mortgage rates had climbed to 6.21%, responding to rattled bond markets and erasing the previous reduction. The uptick came as Trump issued a tariff threat to European allies over his demands to acquire Greenland at the time. When Trump backed off of that levy soon afterward, mortgage rates fell but remained above previous lows, Mortgage News Daily data showed.
The volatility in mortgage rates underscored the risks posed by recent trade tensions, which threaten to push up Treasury yields and, in turn, drive mortgage rates higher, some analysts told ABC News.
Still, they added, mortgage rates will likely face downward pressure this year from anticipated interest-rate cuts at the Federal Reserve, and Trump may take further steps of his own to reduce borrowing costs.
“President Trump is certainly not sitting back and doing nothing,” Susan Wachter, a professor of real estate at University of Pennsylvania’s Wharton School of Business, told ABC News.
“Some of it is big things on the international front, which are potentially destabilizing. And there’s an attempt to do anything and everything for the affordability of housing,” Wachter added.
To be sure, average 30-year mortgage rates have dropped from 7.08% to 6.17% since Trump took office, according to Mortgage News Daily. That drop-off owes in part to a post-pandemic cooldown of inflation, which allowed the Federal Reserve to begin lowering interst rates.
In a social media post earlier this month, Trump said lower mortgage rates would “make the cost of owning a home more affordable. It is one of my many steps in restoring Affordability.”
Mortgage rates closely track the yield on a 10-year Treasury bond. Since bonds pay a given investor a fixed amount each year, the specter of inflation risks higher prices that would eat away at those annual payouts. In turn, bonds often become less attractive in response to economic turmoil. When demand falls, bond yields rise.
U.S. Treasury yields jumped last week in the aftermath of Trump’s tariff threat over Greenland, which appeared to presage a possible trade war with several European allies.
The 10-year Treasury yield climbed as high as 4.3% in the aftermath of Trump’s threat, before dropping steadily down to 4.21% as Trump withdrew the levy and backed negotiations over Greenland, MarketWatch data showed.
As tensions rose in response to Trump’s tariff threat, some major U.S. bondholders in Europe appeared poised to sell. A Danish pension fund, AkademikerPension, said last Tuesday it would unload U.S. treasuries by the end of the month. It remains unclear whether other European bondholders will follow suit, especially after Trump’s reversal on tariffs.
If a substantial share of U.S. bondholders were to sell off their assets, it would slash demand and push up bond yields, some analysts said.
Since 30-year mortgage rates and other key interest rates track the yield on 10-year treasury bonds, a selloff of treasuries could bring about higher monthly payments for home loans, Raymond Robertson, a professor of trade, economics and public policy at Texas A&M University, told ABC News.
“It’s a pretty big concern,” Robertson said.
Marc Norman, associate dean at the New York University School of Professional Studies and Schack Institute of Real Estate, said bondholders are evaluating the reliability of U.S. government debt.
“Basically, it’s a bet on the U.S. government,” Norman told ABC News. “If that becomes unstable and people lose trust, it could have a big effect.”
Despite the uptick in mortgage rates in recent weeks, borrowing costs for homebuyers remain markedly lower than where they stood a year ago.
Analysts attributed the drop to a series of interest rate cuts at the Fed, as well as Trump’s order calling on Fannie Mae and Freddie Mac to buy hundreds of billions of dollars in mortgage-backed securities. After the order, Bill Pulte, the head of the Federal Housing Finance Agency, instructed Fannie Mae and Freddie Mac to up their bond investments in an effort to put downward pressure on mortgage rates, the Associated Press reported last week.
By ordering a federal agency to buy up some mortgage-backed securities, the Trump administration helped increased demand for the underlying loans, which pushed bond yields lower, Wachter said.
“This mortgage bond proposal is not a big move but it makes a difference,” Wachter added. Wachter said she expects mortgage rates to fall further over the course of this year, though she acknowledged ongoing risk: “Investors don’t like uncertainty.”
Still, Wachter said, “If you’re looking to buy a home, today is as good a day as any.”
If homebuyers move forward with a purchase but later find that mortgage rates have continued to fall, they can opt to refinance their homes. “The old saying is, ‘You marry the home and you date the mortgage,'” Wachter said.
Mark Zuckerberg (R), CEO of Meta testifies before the Senate Judiciary Committee at the Dirksen Senate Office Building on January 31, 2024 in Washington, DC. (Anna Moneymaker/Getty Images)
(WASHINGTON) — Mark Zuckerberg is set to testify Wednesday in a landmark Los Angeles trial alleging that major social media platforms were intentionally designed to be addictive for children and teens.
The case, which began last Monday in Los Angeles County Superior Court, centers on claims against Meta — the parent company of Facebook and Instagram — and YouTube, which is owned by Google. Plaintiffs argue the companies knowingly built features that encouraged compulsive use among young users, contributing to long-term mental health harm.
The lawsuit was brought by a now-20-year-old woman identified as “Kaley” and her mother, who allege she was exposed to addictive design features as a child. Her lawyers claim she got hooked on social media apps starting as young as age 6. She says features like auto-scrolling got her addicted to the platforms — ultimately leading to anxiety, depression and body image issues.
In opening statements, the plaintiffs’ attorney Mark Lanier told the jury the case was “as easy as ABC,” which he said stood for “addicting the brains of children.”
The case is the first of more than 1,500 similar lawsuits nationwide to go before a jury, potentially setting a precedent for how tech companies are held liable for product design.
Zuckerberg has appeared before Congress multiple times to address concerns over youth safety and online harms, but Wednesday marks the first time he will testify before a jury on these claims. Legal experts say a verdict in favor of the plaintiff could weaken the broad liability protections tech companies have long relied on under Section 230 of the 1996 Communications Decency Act, which shields platforms from responsibility for user-generated content.(cut)
Several parents of children who died by suicide or accidental harm linked to online trends are expected to attend the proceedings. Some previously watched Zuckerberg apologize during a 2024 Capitol Hill hearing, where he acknowledged families who said social media contributed to their children’s deaths.
The companies deny the allegations, arguing that mental health outcomes are shaped by a range of factors beyond social media use. They say they have implemented safeguards aimed at protecting young users, including parental controls and accounts designed specifically for teens.
In a statement to ABC News at the start of the trial, a Meta spokesperson said, “We strongly disagree with these allegations and are confident the evidence will show our longstanding commitment to supporting young people.”
Meta said that the company has made “meaningful changes” to its services, such as introducing accounts specifically for teenage users.
Zuckerberg’s appearance follows testimony last week from Instagram head Adam Mosseri, who disputed characterizing Instagram use as an “addiction,” while acknowledging what he described as “problematic use.”
Mosseri testified that there’s always a tradeoff between “safety and speech,” saying users don’t like it when they remove options from Instagram.
The Los Angeles trial is part of a broader wave of litigation targeting social media companies. Meta is also facing a separate child safety lawsuit in New Mexico, while lawsuits brought by school districts — modeled after tobacco litigation in the 1990s — are expected to head to trial later this year.
Social platforms Snapchat and TikTok were previously named in the lawsuit but reached settlements with the plaintiffs last month.
Traders work on the floor of the New York Stock Exchange. (Photo by Michael M. Santiago/Getty Images)
(NEW YORK) — Stocks tumbled on Monday as oil prices climbed in response to the U.S.-Israeli war with Iran.
The Dow Jones Industrial Average fell 460 points, or 0.9%, while the S&P 500 dropped 0.5%. The tech-heavy Nasdaq inched down 0.2%.
The major indexes recovered some of their earlier losses on Monday, however, after oil price hikes cooled. Oil markets settled amid a meeting among Group of Seven (G7) finance ministers about a possible coordinated release from their respective strategic petroleum reserves.
The G7 announced on Monday its decision to forego a release of reserve oil at this time, but markets appeared to view the group as willing to take such action.
The Dow fell as much as 750 points on Monday morning, before paring some of its losses in the afternoon.
Indexes fell worldwide on Monday as the spike in oil prices rippled through global markets. Tokyo’s Nikkei 225 index plunged 5.2%, while pan-European STOXX 600 index slipped 0.6%.
Oil prices climbed as traders feared a prolonged blockade of the Strait of Hormuz, a trading route that facilitates the transport of about one-fifth of the global oil supply.
U.S. crude oil prices hovered at about $95 per barrel on Monday afternoon, which marked a nearly 5% hike. Since a month ago, oil prices have soared a staggering 50%.
Oil prices climbed as high as nearly $120 per barrel overnight, but retreated after the Financial Times reported G7 finance ministers would meet to discuss a possible coordinated release from their respective strategic petroleum reserves.
After the meeting, oil prices fell further but remained higher than where they stood a day prior.
The average price of a gallon of gasoline in the U.S. soared to $3.47 on Monday from $2.99 a week earlier, AAA said.
In a social media post on Sunday night, President Donald Trump downplayed the rise in oil prices.
“Short term oil prices, which will drop rapidly when the destruction of the Iran nuclear threat is over, is a very small price to pay for U.S.A., and World, Safety and Peace. ONLY FOOLS WOULD THINK DIFFERENTLY!” Trump said.
Soon after the war with Iran began on Feb. 28, U.S.-Israeli forces killed Supreme Leader Ayatollah Ali Khamenei in Tehran. His son Mojtaba Khamenei was chosen on Sunday to succeed him.
This is a developing story. Please check back for updates.
