NEW YORK, January 5, 2026, 10:47 EST
- Zillow Home Loans listed a 5.99% 30-year fixed rate on Jan. 5, keeping borrowing costs near the closely watched 6% mark.
- A CBS News forecast said January is more likely to bring modest declines or stability than a renewed rate run-up.
- Housing economists say even small rate moves can swing affordability for millions of would-be buyers.
Zillow Home Loans on Monday put its 30-year fixed mortgage rate at 5.990%, nudging borrowing costs back under the 6% line as the U.S. housing market enters 2026.
Why it matters now is simple arithmetic. Around this level, a few tenths of a percentage point can shift monthly payments enough to change who qualifies for a loan, especially for first-time buyers stretching on income.
The same math shows up in refinancing. Lower rates can make it cheaper for homeowners to replace an older mortgage, but many need a meaningful drop to overcome closing costs and fees.
Zillow’s rate card also showed a 30-year FHA loan at 5.875% and 30-year VA and jumbo loans at 6.000%. It listed an annual percentage rate, or APR, which reflects fees, and upfront “points,” which are payments that lower the interest rate.
Forecasters see the next move skewing down. “At the end of the day, even if mortgage rates decline, affordability is still what really matters,” said Winnie Sun, managing director of Sun Group Wealth Partners, in a CBS News forecast published on Monday. CBS News
Refinancing — replacing an existing home loan with a new one — still looks expensive for many borrowers. Zillow data reviewed by Fortune as of Dec. 31 showed a 30-year fixed refinance rate of 6.23%, while FHA and VA refinance rates were below 6%, and the outlet noted a common rule of thumb is that a refi tends to make sense when rates fall by about a full percentage point.
Housing affordability is highly rate-sensitive. An analysis on the National Association of Home Builders’ Eye On Housing blog estimated that a 62-basis-point decline in rates — a basis point is 0.01 percentage point — would bring about 2.8 million additional households into qualification for a median-priced new home of $459,826.
Different trackers often disagree on the precise level, but the direction has been downward from last year’s highs. Freddie Mac’s weekly survey put the average 30-year fixed-rate mortgage at 6.15% as of Dec. 31, down from 6.18% a week earlier.
The policy backdrop has also shifted. The Federal Reserve in December lowered the target range for the federal funds rate — the interest rate banks charge each other overnight — to 3.50% to 3.75%, a move that can influence broader borrowing costs through bond-market expectations.
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