After a terrible year in 2025, there seems to be even less “good news” in the housing market in 2026. According to the Federal Home Loan Mortgage Corp. (usually called Freddie Mac), U.S. mortgage rates surpassed the psychological barrier of 7% on Thursday—a 20-month high. Mortgage rates have been climbing since March, in large part driven by the Iran War, inflation, and the massive federal debt. The 30-year mortgage rates tend to follow the 10-year U.S. Treasury rates, which are at the highest level since July 2007, and the 30-year Treasury rates are the highest since 2004.

Homeownership is a cornerstone of the “American Dream,” yet 41% of Americans fear that this is beyond their reach with rising home prices, shrinking buying power of the average paycheck, lower supply of available homes, reduced credit access, and higher interest rates, according to Investopedia.