What exactly did Fannie Mae and Freddie Mac change?

They were directed to buy up to $200 billion of mortgage-backed securities to absorb supply as the Fed’s portfolio runs off. The aim is to stabilise spreads and lower consumer borrowing costs. If successful, lenders may trim offered mortgage rates as funding improves and pipelines grow.

Will UK mortgage rates fall because of this US plan?

Any effect in Britain is indirect. If US spreads tighten and global yields ease, sterling funding and securitisation conditions may improve. UK mortgage pricing mainly follows Bank of England policy and GBP swap rates, so any pass-through would likely be modest and take weeks or months.

Which indicators should UK investors watch next?

Focus on MBS option-adjusted spreads, the primary–secondary spread at lenders, weekly US mortgage applications, the NAHB builder survey, and US CPI. In the UK, track 2–5 year GBP swaps, BoE guidance, and issuance in sterling RMBS. These will shape funding costs and risk appetite.

Are lower rates always good for homebuilder stocks?

Lower rates help affordability and orders, which often supports valuations. Still, margins, build costs, labour availability, and land spend also drive earnings. For UK developers, domestic demand, BoE policy, and buyer incentives matter more than US policy shifts, so do not rely on rates alone.

Global Market Insights

January 12: Mortgage Rates Slide to 3-year Low as $200B MBS Plan Lifts Builders

ByHuzaifa Zahoor January 12, 2026January 12, 2026

Mortgage rates are sliding to a three-year low after the White House directed Fannie Mae and Freddie Mac to buy $200 billion in mortgage-backed securities. The move is designed to offset Federal Reserve runoff and support cheaper home loans. For UK readers, the change matters for global funding costs, risk sentiment, and equity sectors tied to housing. We outline how the plan works, the likely range of rate effects, and what investors in Britain should watch next.