Fannie Mae predicts major mortgage rate change coming soon

By Jeffrey Quiggle
The Street
October 1, 2025
Category: Finance & Economics
Region: United States

Fannie Mae revised its mortgage rate forecast and other predictions about the U.S. economy in the September report. Among its projections are:

  • Mortgage rates are expected to end 2025 and 2026 at 6.4% and 5.9%, respectively, compared to 6.5%  and 6.1% in Fannie Mae’s prior forecast.
  • The total home sales outlook for 2025 was revised to 4.72 million, compared to 4.74 million previously. Its 2026 home sales projection is 5.16 million, compared to 5.23 million previously.
  • It revised its real gross domestic product (GDP) growth outlook for 2025 and 2026 to 1.5 percent and 2.1 percent on a Q4/Q4 basis, compared to 1.1 percent and 2.2 percent in its previous forecast, respectively.
  • Regarding inflation, Fannie Mae expects the Consumer Price Index (CPI) to rise to 3.1 percent Q4/Q4 in 2025, compared to its August forecast of 3.3 percent. The CPI outlook for 2026 is 2.6 percent, a prediction that is unchanged.

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