Real estate technology company Zillow has a dire prediction about mortgage rates and the housing market in general, noting that rates are rising and will remain high for homeowners and homebuyers through the remainder of 2026.
“Mortgage rates holding above 6.5% — their highest level in a year — kept many buyers on the sidelines,” Zillow wrote in a statement. “Newly pending listings, a forward-looking measure of demand, fell 2.6% from a year ago, a sign that the slowdown could continue through the remainder of the year.”
In fact, the daily mortgage rate is even higher than that, according to Mortgage News Daily (MND).
“You may have seen other headlines today that reference 30-year fixed rates of 6.76%,” MND’s Matthew Graham wrote on Sept. 10. “Those stories would be citing Freddie Mac’s weekly rate survey which is an average of the 5 business days (4 in this case, due to the holiday) ending yesterday (September 9th).”
“Because of that methodology, the number lags reality. Today alone, the average lender moved up 0.125% in rate. In addition, Freddie no longer accounts for ‘points’ (additional money paid upfront for a lower rate),” Graham continued. “In other words, 6.75% with one point is roughly the same rate as 7.00% with no points.”
“As a reminder, our daily rate index accounts for the impact of points, so day-to-day comparisons are always apples to apples.”
Freddie Mac reports mortgage rates on the rise
Freddie Mac’s weekly mortgage rate update showed an increase on its way up.
“The 30-year fixed-rate mortgage averaged 6.76% this week,” said Sam Khater, Freddie Mac’s chief economist. “Aspiring buyers should remember shopping around for the best mortgage rate and getting multiple quotes can potentially save them thousands.”
Freddie Mac expanded further to provide some yearly context.
“The 30-year FRM averaged 6.76% as of September 10, 2026, up from last week when it averaged 6.71%,” Khater added. “A year ago at this time, the 30-year FRM averaged 6.35%.”
“The 15-year FRM averaged 6.09%, up from last week when it averaged 6.04%. A year ago at this time, the 15-year FRM averaged 5.50%.”
Zillow emphasizes housing market discouraging news
Because August sales figures predominantly capture deals locked in during July — a time when high interest rates had already cooled buyer enthusiasm — closed transactions remained sluggish.
Zillow’s Home Value Index shows the typical U.S. home value reached $369,678 (a 1.3% year-over-year increase), while monthly mortgage costs for a median home rose 2% compared to last year.
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“The for-sale housing market took a step back in August, and mortgage rates above 6.5% are the primary culprit,” said Mischa Fisher, chief economist at Zillow. “The combination of weak sales and even weaker pending sales points to a soft close to 2026.”
“There are more homes for sale than a year ago, which is good news for buyers who are ready to move, but until rates ease, many households will likely stay on the sidelines a little longer as renting is still the more affordable substitute.”
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Zillow explains cooling housing market
The U.S. housing market cooled in August as high borrowing costs nudged home values down 0.1% from July to $369,678, according to Zillow. Though values remain 1.3% higher than last year, high ownership costs continue to strain buyers.
A typical monthly mortgage payment reached $1,897 — up 2% annually — assuming a 20% down payment alongside estimated taxes, insurance, and maintenance.
Inventory grew slightly to 1.41 million active listings, a 0.2% increase from July and 3% higher than a year ago.
New listings fell 7.9% month-over-month to 356,934, despite a 2.4% annual rise. This supply tightening and persistent affordability pressures pulled transaction volume down significantly.
Zillow’s nowcast reported 339,927 sales in August, marking a 0.6% annual decline and a sharp 10.7% plunge from July.
Related: Fannie Mae predicts where home prices are headed next
