This Market Update is written by our Capital Market specialists each week to bring you insight into what's happening in the market and how it may affect mortgage rates and real estate trends.
Interest rates from February 20th to February 26th centered on a clear theme, rates hovered near multi‑year lows, improving affordability and creating momentum. The period did not include a Federal Reserve meeting, so the most meaningful developments came from mortgage‑rate movements, buyer affordability shifts, and refinance opportunity signals.
As we near March and the start of Spring, the Federal Reserve appears like they’ll stay put on changing their benchmark rate at their next meeting on March 17-18. The Federal Reserve is indicating a cautious approach to reducing rates in2026, with the recent FOMC minutes.
FedWatch: Target rate (in bps) possibilities, according to the CME Group (as of 02/26/2026 – 12:00 PM EST):
Good Growth:
Although 25Q4 GDP was just 1.4%, half of what was expected (and down from an unsustainable 4.4% in 25Q3), the government closure knocked off 1.2 percentage points. If you remove trade, inventories and government, 25Q4growth was 2.4% and for all of 2025 a solid 2.5%, down from 2.9% in 2024. For 2025, overall GDP was 2.2%, slightly lower than 2024’s 2.4%. All this suggests underlying GDP growth is fine. - Elliot Eisenberg, Economist
· Home Loan Demand Inches Up 0.4% as Rates Fall to Lowest Level Since 2022
· Mortgage rates hit lowest level in nearly 4 years
· Trump Vows To Protect Customers Over Rising Energy Costs From Data Centers
· Nearly 1 in 7 Home Sales Are Falling Through, a Record For This Time of Year
· A 25-Basis-Point Decline in the Mortgage Rate Prices-In 1.42 Million Households
*Communication is intended for Industry Professionals only and not intended for Consumer Distribution
Interest rate and annual percentage rate (APR) are based on current market conditions as of 02/26/2026, are for informational purposes only, are subject to change without notice and may be subject to pricing add-ons related to property type, loan amount, loan-to-value, credit score and other variables. Estimated closing costs used in the APR calculation are assumed to be paid by the borrower at closing. If the closing costs are financed, the loan, APR and payment amounts will be higher. Contact us for details. Additional loan programs may be available. Accuracy is not guaranteed, and all products may not be available in all borrower's geographical areas and are based on their individual situation. This is not a credit decision or a commitment to lend. Actual interest rate, APR, and payment may vary based on the specific terms of the loan selected, verification of information, your credit history, the location and type of property, and other factors as determined by Prosperity Home Mortgage, LLC. Not available in all states. Rate is as of 02/26/2026 and is subject to change at any time without notice. Opinions, estimates, forecasts, and other views contained in this document are those of Freddie Mac’s economists and other researchers, do not necessarily represent the views of Freddie Mac or its management, and should not be construed as indicating Freddie Mac’s business prospects or expected results. Although the authors attempt to provide reliable, useful information, they do not guarantee that the information or other content in this document is accurate, current, or suitable for any particular purpose. All content is subject to change without notice. All content is provided on an “as is” basis, with no warranties of any kind whatsoever. Information from this document may be used with proper attribution.