Mortgage Rates Remain High as Affordability Challenges Persist

AdvertisementSKIP ADVERTISEMENTThe average 30-year, fixed-rate home loan fell slightly, to 7.11 percent, pushing buyers and sellers to the sidelines until conditions improve.Mortgage rates remain above 7 percent.Credit...Sebastian Siadecki for The New York TimesNov. 12, 2026, 12:01 p.m. ETMortgage rates slid for the fourth consecutive week but remain above 7 percent, adding pressure to a bleak housing market struggling with rising prices and declining sales.The rate on the most popular home loan in the United States, the 30-year fixed-rate mortgage, fell slightly to 7.11 percent, from 7.18 percent the week before, the mortgage finance giant Freddie Mac said on Thursday. The same rate averaged 6.24 percent a year ago.There was hope that mortgage rates might ease below 7 percent, a psychological threshold that could draw more buyers to the market. But industry experts say that marker is not likely to be breached any time soon.High housing costs have made buying a home unaffordable for many Americans, said Brad Case, the chief residential economist at Homes.com, a real estate search portal owned by CoStar, a data analytics company.“I don’t think affordability challenges are going away any time soon,” he added, “because I don’t think we’re likely to see substantially lower mortgage rates.”Squeezed by high mortgage rates and rising inflation, buyers and sellers are sitting out of the market until conditions improve, which has depressed home sales. Sales of existing homes fell 8.8 percent in October from the year before, and 5.5 percent lower than September’s pace, according to a report released Thursday by the National Association of Realtors, a trade group.Existing-home sales have fallen to a seasonally adjusted annual rate of 3.75 million, their slowest since August 2010, the NAR report said. A healthy annual sales pace is typically about five million existing homes.“It’s a tough market for buyers and sellers,” Lawrence Yun, NAR’s chief economist, said Thursday on a call with reporters, adding that the sales outlook for 2026 is looking increasingly gloomy. “It could be one of the lowest annual figures, once we tally up the final three months of this year,” he said.Affordability challenges are likely to keep sales low for the next few months, said Danielle Hale, chief economist at Realtor.com. a listings website.“I don’t think this is a new normal for home sales,” she said in a statement. “Instead, it reflects a perfect storm of an abrupt shift in the financial environment and large uncertainties in the pre-election period for both policy and the economy just as the housing market usually slows for the season.”The housing market began to lock up in 2022, when mortgage rates started to climb after falling below 3 percent. Homeowners who snagged the ultralow rates have been unwilling to sell, which has put the market in a prolonged gridlock.“You are going to have a frozen housing market for a long time,” said Jeff Ostrowski, housing market analyst at Bankrate, a consumer financial services company. “It’s been, I think, even more dramatic than anyone expected, just because mortgage rates went up so much.”Mortgage rates fell below 6 percent the last week of February, giving hope that the housing market might rebound, but they began rising again after the United States and Israel launched attacks on Iran on Feb. 28. The war, which has lasted more than eight months, has driven up costs for fuel and food.Consumer prices rose sharply in October, climbing 0.4 percent after a 0.6 percent increase in September. But wage growth has not kept pace, and home buyers are feeling the pinch because they have less to put toward a home.“For affordability to get better, what really needs to happen is income growth,” Mr. Case of Homes.com said.The jump in inflation has increased the odds that the Federal Reserve will raise interest rates at its next meeting in December, which could put upward pressure on mortgage rates. The yield on the 10-year Treasury note, which underpins consumer loans like mortgages, climbed above 5 percent after the inflation report was released on Tuesday.Gregory Schmidt is a senior staff editor who has covered real estate since 2022.Related ContentAdvertisementSKIP ADVERTISEMENT