Each week, I analyze the evolving dynamics of the market, identifying emerging trends, shifts in momentum, and key considerations for real estate professionals. Last week, mortgage rates fell twenty-two basis points to a three-year low as President Donald Trump directed Fannie Mae and Freddie Mac to purchase two hundred billion dollars in mortgage bonds.Asaffordability improves, economists expect stronger sales activity in 2026, supported by easing rates, steady inventory, and slower home price growth, even as job creation continued to cool and the unemployment rate inched down to 4.4 percent at the end of the year.
January 12, 2026
TRUMP DIRECTS GSEs TO BUY $200B IN MBS TO PUSH MORTGAGE RATES LOWER.President Donald Trump directed representatives at Fannie Mae and Freddie Mac to pursue a two-hundred–billion-dollar purchase of mortgage-backed securities — an effort aimed at narrowing the unusually wide spread between Treasury yields and mortgage rates to easing borrowing costs. Supporters say added demand can help ease rates; critics say larger retained portfolios may revive concerns tied to the 2008 financial crisis despite today’s stronger underwriting standards. Full story from HOUSINGWIRE →
- Why this Matters: This matters to consumers because it goes straight to the cost of borrowing for a home. A two hundred-billion-dollar purchase of mortgage-backed securities would increase demand in that market, which can narrow the unusually-wide spread between Treasury yields and mortgage rates, which ultimately has potential to bring rates down. Even a modest decline in rates can meaningfully reduce monthly payments, expand purchasing power, and improve affordability at a time when many buyers are constrained by high prices and limited inventory.
EXPERT FORECASTS POINT TO AFFORDABILITY IMPROVING IN 2026. The 2026 housing market is expected to offer the most balanced and affordable conditions buyers and sellers have seen in years as easing mortgage rates, available inventory, and slower home price growth improve opportunities across the board. After affordability reached a three-year high in 2025, experts anticipate continued progress as rates stabilize in the low six percent range, giving buyers more purchasing power. Inventory is projected to grow again, though at a more moderate pace, expanding choice for buyers and encouraging sellers to price strategically in a recalibrating market. Home prices are still expected to rise nationally at a slower, sustainable rate, creating predictability for buyers while preserving equity for sellers. With these trends converging, economists forecast an increase in home sales as improved affordability and steadier market conditions give people breathing room to make a move in 2026. Full story from KEEPING CURRENT MATTERS→
- Why this Matters: The trends taking shape for 2026 directly influence what people can afford, how far their money goes, and how much choice they have when making one of the biggest financial decisions of their lives. Lower mortgage rates mean reduced monthly payments and increased buying power, rising inventory gives buyers more options and negotiating room, and slower price growth creates a more predictable and stable environment for budgeting and planning. Together, these shifts signal a market that is becoming more accessible after several challenging years, giving consumers the breathing room they need to move forward with confidence.
U.S. PAYROLLS ROSE 50,000 IN DECEMBER, UNEMPLOYMENT RATE FALLS TO 4.4%.The U.S. labor market closed 2025 on a softer footing, with December payroll growth falling short of expectations and accompanied by downward revisions to prior months, even as the unemployment rate edged lower to 4.4 percent and the broader underemployment measure improved. Wage growth remained steady and consumer spending was robust, helping support an economy that continued to expand at a solid pace despite slow job creation outside of downturns. Financial markets reacted calmly, and the data will remain central to Federal Reserve deliberations as policymakers assess whether the cooling labor backdrop warrants further rate adjustments in the months ahead. Full story from CNBC →
- Why this Matters: The jobs report shapes the economic environment consumers feel every day, from job security to borrowing costs to overall confidence about making major financial decisions. Slower hiring, paired with steady wage growth, creates a mixed backdrop: people may feel less certain about future opportunities even as their paychecks hold up. At the same time, a cooling labor market can influence the Federal Reserve’s approach to interest rates, which affects everything from mortgage payments to credit card costs. Strong consumer spending and solid economic growth suggest households are still willing to spend, but the uneven job picture adds a layer of caution that many families will recognize in their own experiences.
THE BOTTOM LINE: The first week of 2026 delivered several developments that may influence affordability, consumer confidence, and real estate activity in the months ahead. President Donald Trump’s directive for Fannie Mae and Freddie Mac to purchase two hundred billion dollars in mortgage bonds pushed rates to a three-year low, reinforcing expectations that easing borrowing costs, steady inventory, and slower home price growth will support stronger housing demand. At the same time, the labor market continued to cool with modest job gains and a lower unemployment rate, creating a mixed economic backdrop that the Federal Reserve will watch closely as it considers future rate decisions. Together, these trends point to a real estate market gaining balance, even as broader economic signals remain uneven.
Disclaimer: this is a compilation of industry news from trade media and industry groups; it does not share any forward-looking predictions or projections.
