Housing Payments Hit a 2-Year Low

January 2026 brought some of the best news for prospective homebuyers in years. Monthly housing payments have fallen to their lowest level in two years thanks to a steady decline in mortgage rates. Despite this, the market has not yet seen a major surge in buying activity.

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Mortgage Rates Are Dropping

• The average 30-year mortgage rate recently fell to around 6.15%, down from rates near 7% in early 2025.
• Rates even briefly dipped below 6%, a level not seen since 2023, following policy updates and shifts in the bond market.
• Lower rates reduce monthly payments and increase what buyers can afford, giving those on the sidelines a window of opportunity.

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Monthly Payments Become More Affordable

Redfin data shows that the median U.S. housing payment fell to about $2,365 for the four weeks ending January 4. This is about 4.7% lower than a year ago and the lowest level since early 2024. Lower payments increase buyers’ purchasing power, even with home prices remaining high in many areas.

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What Buyers Should Know

• Lower rates help, reducing monthly costs and increasing purchasing power.
• Payments alone don’t solve all challenges, as high prices and limited inventory still affect decisions.
• Spring could bring more opportunities, with adjusted rates and increased listings.

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Bottom line: After years of high borrowing costs, mortgage rates are finally easing. Monthly payments are becoming more affordable, but many buyers are still waiting for more favorable conditions before making a move.

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Disclaimer: This content is meant for informational purposes only and is not intended to be construed as financial, tax, legal, or insurance advice.