I have mentioned on several occasions that I predicted mortgage rates below 6% in the fourth quarter of 2025.
We are now in the fourth quarter, but still have about two and a half months to go before the calendar rolls over to Q1 2026.
It actually feels like an eternity given mortgage rates can change daily, often experiencing all sorts of unforeseen twists and turns.
And if you look at the trend lately, with lower and lower interest rates, you can’t rule out a 30-year fixed mortgage rate starting at a 5 at some point this year.
But the “chance” of that happening is still pretty low, at least by market makers.
Will the 30-year fixed rate fall below 6.00% at any point before December 31st?
I checked Polymarket this morning to see what the odds were for a 30 year fixed below 6% on December 31st.
I knew it was one of the markets in there so I was curious if it had become more of a favorite lately.
After all, mortgage interest rates have moved lower recently and are close to three-year lows.
They’re also not too far over 6% anymore, so the idea of ​​a mortgage rate starting with a “5” doesn’t sound so crazy anymore.
Despite this, there are still long odds for us to see a 30-year fix below 6% in the next 75 days or so.
At last glance, there was only a “28% chance” of this happening at Polymarket, which seems pretty low as the 30-year fix was last reported at 6.27% per year. Freddie Mac.
This is the source used for this proposal. The 30-year average of fixed-rate mortgages (FRM) found in Freddie Mac’s weekly Primary Mortgage Market Survey (PMMS).
Although it seems so close, the Freddie rate index can move slowly and often lags (the problem with mortgage surveys).
It’s also a survey! So the banks and lenders they ask will tell you the rates are below 6%.
Anyway, I thought it was interesting that the odds of a 30-year mortgage rate below 6% were nearly 50% just three weeks ago.
And today, despite rates moving lower, odds are just 28%, albeit up significantly from 13% last week.
Why mortgage rates may not fall below 6% this year
I have already explained why mortgage rates could fall below 6% in December.
Now let’s talk about why they might not, since those are the odds we’re looking at. A 28% chance indicates that something is a longshot after all.
So what is the rationale here? Well, one problem standing in the way of even lower mortgage rates, which only need to drop ~0.25% from here, is lack of new data.
With the government shutdown easing, there is no new data from the government.
So we don’t get the monthly jobs report, which is the biggest move in mortgage rates (both up and down).
And the one that has pushed them lower lately because the reports have been so bad.
Since we don’t get new job creation and unemployment data, mortgage rates may be a bit “stuck” at the moment.
They can move something, but they can be a bit range bound because their biggest driver is out of action right now.
One caveat here is that we get a delayed CPI report next Friday, which may weigh more heavily than usual as other reports are on hold.
If the weather picks up, mortgage rates could jump higher. But if it’s another cool report, it could push mortgage rates even closer to the 5s.
Another problem is the large number of days left in the calendar year. We have about 75 days left in 2025.
It is not a small number of days, but it will not be longer. So every day that passes you have fewer days to “win”.
The Freddie Mac survey only comes out once a week, on Thursdays, so the timing has to be just right to catch a low rate day.
For example, mortgage rates can drop below 6% on a Monday and bounce back by Wednesday at the latest and never show up in the data.
So that in itself can drive the odds of this happening lower. With less and less time it gets harder.
However, it looks like we’re headed in that direction, even if it’s just a matter of if time.
(photo: k)
Before creating this site, I worked as an account manager for a wholesale mortgage lender in Los Angeles. My hands-on experience in the early 2000s inspired me to start writing about mortgages 19 years ago to help potential (and existing) homebuyers better navigate the home loan process. Follow me on X for hot takes.