January is usually boring in the mortgage world. It’s the month where activity slows, people recover from the holidays, and honestly… I start questioning my career choices and pick up a new hobby.

This year? Completely different.

Between the end of last year and the start of 2026, I’ve spent a lot of time saying, “What? Wait… WHAT?” Some of that reaction has been concern, but some of it has been genuinely good news for housing.

So let’s walk through what’s actually happening, what matters, and what you should be paying attention to as a buyer, homeowner, or someone planning ahead.

(And for context, I’ve been a mortgage lender for 19 years. My team is one of the top purchase teams in the country, and we help buyers nationwide—whether you’re buying now or five years from now.)

Why January Feels Different This Year

We started 2026 with mortgage rates lower than they’ve been in more than 3.5 years. That alone is unusual for January.

When rates dip into the high-five to low-six range, two things happen immediately:

• Refinance activity picks up

• Buyers who’ve been sitting on the sidelines suddenly re-engage

On government loans (VA, FHA, USDA), rates are even more competitive, which is why we’re seeing activity much earlier than normal.

This isn’t typical January behavior, and it tells us something important: pent-up demand is still there.

What’s Actually Driving Mortgage Rates Right Now

A lot of people obsess over the Federal Reserve when it comes to mortgage rates, but that’s only part of the story.

One of the biggest recent developments is that the President directed Fannie Mae and Freddie Mac to buy mortgage-backed securities.

Here’s why that matters (in plain English):

When lenders close a mortgage, it gets packaged and sold as a mortgage-backed security. If there are strong buyers for those securities, lenders don’t need to charge higher interest rates to attract investors.

From 2020–2022, mortgage rates were incredibly low, not just because of the Fed, but because there were massive buyers in the mortgage-backed securities market.

Since 2022, that support largely disappeared… until now.

Is this action enough to keep rates dropping forever? No.
Did it help? Absolutely.

We’ve already seen roughly an eighth to a quarter-point improvement, which is meaningful, especially when rates were already near recent lows.

If you ever see headlines about large institutions buying mortgage-backed securities, that’s generally good news for mortgage rates.

Institutional Investors: A Real Shift (Finally)

I’ll be honest—I did not have this on my 2026 housing bingo card.

An executive order was signed to ban institutional investors from purchasing single-family homes going forward.

That’s a big deal.

We’ve seen entire neighborhoods hollowed out by corporate ownership. In some areas, over 30% of single-family homes are owned by institutions. That hurts affordability, availability, and long-term community stability.

What makes this different from past proposals is that it’s reasonable:

• Corporations aren’t being forced to sell what they already own

• The rule applies moving forward

• It doesn’t violate existing property rights

That’s why I actually think it has a real chance of sticking.

There is currently a carve-out for build-to-rent communities, which I’m watching closely. Ideally, individual buyers should have first access before entire developments are sold off to corporations.

Is this a perfect solution? No.
Is it progress? Absolutely.

And in housing, progress matters.

A Possible Game-Changer: Using 401(k)s for Down Payments

Another idea floating around that hasn’t been implemented yet, but could be huge, is allowing 401(k) funds to be used toward down payments without punitive tax consequences.

Right now, buyers can borrow against retirement accounts—but repayment is often made with after-tax dollars, which complicates things.

If policymakers create a structure where:

• Funds can be used without immediate tax penalties

• Repayment is deferred until the sale

• Or taxes are avoided altogether

That would remove one of the biggest barriers to homeownership for people who are financially responsible but cash-tight.

This is something I’m watching closely.

Inventory Headlines vs. Reality

You’ve probably seen headlines claiming inventory is “up nationwide.”

That’s misleading.

The majority of increased inventory is concentrated in a handful of states. In other areas, homes are still selling:

• Over asking

• With multiple offers

• And minimal contingencies

This ties directly into what I’ve talked about in our earlier blog on the lock-in effect—many homeowners with ultra-low rates simply aren’t moving yet, which keeps supply tight in certain markets.

Real estate is hyper-local. Always has been.

A Surprising Real Estate Stat

Despite lawsuits, commission changes, and tough market conditions…

Only 3% of real estate agents left the industry in 2025.

That honestly shocked me.

What it tells us is that while the industry is evolving, it’s stabilizing—not collapsing.

So What’s the Big Picture?

Here’s the takeaway:

• Mortgage rates are improving

• Refinance opportunities are real

• Buyers have more leverage than they’ve had in years

• We’re finally seeing policy discussions focused on affordability

• The market remains local—not headline-driven

Is everything fixed? No.
Is this the most encouraging start to a year we’ve seen in a while? Yes.

If you want to know whether refinancing makes sense, or you’re trying to decide when (or where) to buy, the smartest move is building a plan—not guessing.

We’re Here for You 🙂

Call or Text Me Here: (786) 933-2077
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Whether you’re buying now or mapping out the next few years, we’re happy to help you make sense of it all.