If you’re watching mortgage rates in early 2025, you’ve probably noticed they’re hovering in the high 6 to low 7 percent range—a bit sticky, a bit stubborn, and still higher than most buyers or homeowners would prefer.

So what’s next? Especially with the Federal Reserve staying cautious and inflation still a topic of concern, should you wait it out? Refinance now? Lock in a rate or gamble on the future?

Let’s break down what the experts are saying, and what it means for your next move.

Mortgage Rate Forecasts: What Experts Expect

Several major housing authorities are aligned on this: Mortgage rates will likely trend down slowly, but not dramatically.

• Fannie Mae projects 30-year fixed mortgage rates will drop to around 6.1% by the end of 2025.

• The Mortgage Bankers Association (MBA) predicts rates could dip into the mid-to-low 6s by early 2026.

• According to Realtor.com’s 2025 housing outlook, softening inflation and slowing job growth may push the Fed to cut rates in the second half of the year.

That means we could see some relief, but probably not a return to the 3–4% mortgage rates we saw in 2020 and 2021. Those were the exception, not the rule.

What Does That Mean for Homebuyers?

If you're thinking about buying your first home, here’s the good news: You don’t need perfect timing to win in this market.

Even a modest rate drop might not outweigh the cost of waiting—especially if home prices continue to rise.

According to Redfin’s 2025 data, the national median home price is still up year-over-year, and demand from first-time buyers is growing, especially in affordable metro areas.

If you're renting, delaying could mean paying more in total housing costs—even if rates come down slightly. Getting in now with a solid plan (and maybe a chance to refinance later) could set you up for long-term equity.

What About Refinancing in 2025?

If you bought your home in the past couple of years and are sitting at 7% or higher, refinancing might make sense—but only if the numbers work.

Ask:

• How much would I actually save monthly?

• What are the closing costs or fees?

• How long do I plan to stay in the home?

And most importantly: Does this move improve my overall financial picture?

For homeowners with equity, another option might be a cash-out refinance or HELOC to consolidate debt or fund other goals—especially while home values remain strong in many areas.

Should You Wait or Act Now?

It depends on your goals:

• If you're looking to buy your first home and can afford it now: Don’t let the rate hold you back. Waiting for the “perfect” moment often leads to missed opportunities.

• If you're planning a move later this year: Keep an eye on how rates respond to Fed meetings and inflation data in Q3 and Q4.

• If you're already a homeowner with a 6.5%+ loan: Start running the numbers now so you’re ready to refinance if rates slip.

Final Word: Focus on What You Can Control

No one—not even the Fed—can perfectly predict rates six months from now. What you can control is how prepared you are.

• Know your budget

• Get pre-approved

• Watch the market—but don’t let it paralyze you

If you want help sorting through the options, talk to someone who knows both the math and the market. No pressure, no sales pitch—just straight answers.

Because the right time to buy or refinance isn’t about a headline. It’s about what’s right for you.