Mortgage Rates Aren’t High. Your Point of Reference Is.

“Rates Are So High Right Now” — Are They, Though?

“I’ll just wait until rates come down.”

I hear some version of that almost every week. And I get it. If you bought, sold or refinanced a home a few years ago, today’s mortgage rates can be tough to swallow.

But after more than 20 years in residential real estate, I think it’s important to separate what feels expensive from what is historically unusual. Those aren’t necessarily the same thing.

Where Rates Are Today

As of September 3, 2026, the average rate on a 30-year fixed mortgage was 6.71%, according to Freddie Mac.

Compared with the 3% mortgages many homeowners remember from just a few years ago, 6.71% sounds high. Compared with the longer history of mortgage rates, it really isn’t.

Freddie Mac has tracked mortgage rates since 1971. When rates reached 6.39% in 2023, the organization noted that rates had been at or above that level in 62.5% of its weekly surveys since tracking began.

Think about that for a second. What felt like a “high” rate in 2023 was actually lower than what homebuyers had encountered during most of the previous five decades.

During the weeks when rates were 6.39% or higher, the average was roughly 9.4%.

That puts today’s market in a very different perspective.

What Has “Normal” Looked Like?

Consider the average mortgage rates buyers faced in previous decades:

1970s: about 8.9%

1980s: about 12.7%, with rates peaking at 18.63% in October 1981

1990s: about 8.1%

Today: roughly 6.5%–6.75%

People bought homes in all of those markets. They raised families in them, accumulated equity and used homeownership to build wealth.

That doesn’t mean interest rates don’t matter. Of course they do. A lower rate means a lower monthly payment and greater purchasing power.

But historically speaking, a mortgage rate in the 6% range isn't extraordinary.

So why does it feel like it is?

We Got Used to Something Extraordinary

For years following the 2008 financial crisis, borrowing costs remained unusually low. Then COVID arrived.

In response to the economic shock of the pandemic, the Federal Reserve cut its target interest rate to essentially zero and purchased large quantities of mortgage-backed securities. Mortgage rates fell to levels buyers had rarely, if ever, seen before.

The average 30-year mortgage rate fell to 3.11% in 2020 and 2.96% in 2021.

Those numbers changed our expectations.

Here’s an analogy I use with clients.

Imagine a streaming service normally costs $12 a month. During a difficult period, the company offers an aggressive promotion and drops the price to $5.

People understandably love the $5 price.

Eventually, though, the promotion ends and the service goes back to $12. Nobody enjoys paying more, but the $5 price wasn't evidence that $12 suddenly became outrageous. It was a temporary discount created by unusual circumstances.

Mortgage rates during the pandemic were a lot like that.

The 2% and 3% mortgages weren't simply the next stage in a permanently cheaper housing market. They were the product of extraordinary economic conditions and extraordinary government intervention.

Those conditions ended.

Our expectations didn't change nearly as quickly.

The Low-Rate Market Had a Cost

There’s another part of the 2020–2022 housing market that tends to get forgotten.

Yes, mortgage rates were incredibly low.

Buying a house wasn't necessarily easy.

Remote work changed what many families wanted from their homes. Suddenly an office, another bedroom or a larger backyard became much more valuable. First-time buyers entered the market in large numbers. Inventory was already tight, and demand surged.

Then came the bidding wars.

Multiple offers became routine. Homes frequently sold above asking price. Buyers waived contingencies, stretched budgets and competed aggressively simply to get a contract accepted.

Low borrowing costs helped buyers afford larger mortgages, but all that purchasing power was chasing a limited number of homes. Prices climbed rapidly as a result.

In other words, the benefit of a historically cheap mortgage didn't exist in a vacuum. Many buyers received an incredible interest rate while simultaneously paying a historically high price for the house.

There is always more to the housing market than one number.

Stop Comparing Every Market to 2021

This is where I think buyers can get themselves stuck.

They compare today's market with 2020, 2021 or 2022 and assume something must be wrong because the numbers don't look the same.

But those weren't ordinary years.

They included a global pandemic, massive economic intervention, historically low borrowing costs, major changes in where and how people worked, severe housing shortages and extraordinary buyer demand.

That isn't a particularly useful benchmark for deciding whether buying a home makes sense in 2026.

Instead of asking:

“Why aren't mortgage rates 3% anymore?”

Ask:

“Given today's home prices, mortgage rates, inventory and my financial situation, does buying a home make sense for me?”

That's a question worth answering.

And importantly, the answer won't be the same for everyone.

The Bottom Line

Would I rather see a client get a 3% mortgage than a 6.5% mortgage?

Absolutely.

But waiting for the housing market to recreate 2021 is not a strategy I would recommend.

Homebuyers in the 1970s dealt with rates around 9%. Buyers in the 1980s saw double-digit rates. Buyers in the 1990s routinely borrowed at rates above what we're seeing today.

They still bought homes.

Today's buyers have their own set of challenges, and affordability is a very real concern. Interest rates should absolutely be part of the decision. So should the price of the home, monthly payment, available inventory, expected time in the property, income, savings and the buyer's long-term goals.

For some people, those numbers will say, “Wait.”

For others, they may say something very different.

The point isn't that today's mortgage rates are cheap. They aren't.

The point is that they're not historically extraordinary simply because they look expensive next to 2021.

What changed wasn't just the rate. What changed was our idea of what a normal rate looks like.

Don't let the memory of an extraordinary market make the decision for you in the market we actually have today.