Right Now: Interest Rates & What It Means for You

Let’s talk about where interest rates are right now, why they’ve moved the way they have, and what that likely means moving forward. We know this is one of THE biggest factors on your mind whether you’re thinking about buying, selling, refinancing, or just watching the market.

As of early January 2026, 30-year fixed mortgage rates have been hovering just above 6%, with national averages around the 6.0–6.2% range depending on the lender and day’s pricing. That’s significantly lower than the peaks we saw in early 2025 (rates went above 7% at times) and cooler than many feared they would be going into the new year.

For homeowners looking to refinance, 15-year fixed and adjustable-rate products also present options with rates around the mid-5% range, depending on credit profile and timing.

This shift matters locally here in Maryland, DC, Virginia, Pennsylvania, and West Virginia because it directly impacts how much house you can afford. Lower rates mean a smaller monthly payment on the same loan amount, and that increases buying power instantly. Agents here are seeing more buyers dip back into the market because those monthly payments suddenly look more manageable.

Why Rates Are Moving This Way

So what’s driving this? A few big pieces:

Federal Reserve rate cuts late last year helped ease borrowing costs across the board. While mortgage rates don’t move in perfect lockstep with Fed funds, the trend has loosened pressure across credit markets. Bond markets and economic expectations, particularly around inflation, are key drivers of long-term mortgage pricing. When inflation cools, long-term rates tend to ease.

Put together, we’re seeing rates that are down nearly a full percentage point from the highs of 2025, which is a meaningful bend in the curve that can translate into real monthly savings for buyers and better timing for refinancers.

What’s Ahead in 2026?

Looking forward, the consensus among housing economists and mortgage analysts is that rates will likely stay in the low-to-mid-6% area throughout 2026, and could modestly dip closer to or under 6% by late in the year. That softer trend is predicted because inflation is gradually cooling, and markets are pricing in expectations that long-term yields won’t climb sharply.

It’s not a guarantee. Borrowing costs could remain stubborn if inflation spikes again or macroeconomic shifts impact Treasury yields, but the trajectory feels more favorable than the last couple of years.

What does that mean for you?

Buyers: if you’re on the fence, locking in a low-6% rate now could be smarter than waiting for a slight dip later. Uncertainty often creeps in quickly, and a rate lock can protect your payment if markets swing.

Sellers: more buyers with improved buying power means more qualified buyers walking through your door, especially here in our local markets where inventory has been tight.

Refinancers: if your current rate is high (especially if it’s 6.5% or above), refinancing into today’s pipeline of products could trim years off your loan or significantly cut monthly payments.

Local Insight from Frederick to the DMV Region

Across Maryland, DC, Virginia, Pennsylvania, and West Virginia, we’re already seeing increased buyer activity. Not a frenzy, but steady motivation. Spring is right around the corner, and this tempered rate environment is exactly the kind of push that gets people moving.

As always, if you want to run numbers together, crunch affordability with your specific goals, or just talk strategy for your timeline, The Krop Team and I are here for it. Let’s make 2026 your best year yet in real estate.