Finance September 23, 2025

Fannie Mae predicts mortgage rates will end 2025 at 6.4%

Sarah Wolak

Fannie Mae’s Economic and Strategic Research (ESR) Group now predicts mortgage rates to end 2025 and 2026 at 6.4% and 5.9%, respectively, compared to 6.5% and 6.1% in its previous forecast. The group also revised its real gross domestic product (GDP) growth outlook for 2025 and 2026 to 1.5% and 2.1% on a Q4/Q4 basis, compared to the prior forecast of 1.1% and 2.2%, respectively. The group’s September 2025 Economic Developments, released on Tuesday, forecasts the Consumer Price Index (CPI) to rise 3.1% Q4/Q4 in 2025, compared to its August forecast of 3.3%. The CPI outlook for 2026 is 2.6%, unchanged from the group’s prior forecast. Core CPI is expected to rise 3.2% Q4/Q4 in 2025 (3.3% previously) and 2.7% in 2026 (2.6% previously).Fannie Mae revised its total home sales outlook for 2025 to 4.72 million, compared to 4.74 million previously forecasted. Its 2026 home sales projection is 5.16 million, compared to 5.23 million previously. ‘We project single-family mortgage originations to rise to $1.85 trillion and $2.32 trillion, respectively, for 2025 and 2026, compared to our previous forecast of $1.85 trillion and $2.26 trillion, respectively,” the group wrote.

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