Updated September 16, 2026
The Federal Reserve raised its target range for the federal funds rate by 0.25 percentage point on September 16, bringing the range to 3.75%–4.00%. The Federal Open Market Committee said economic activity remains solid while inflation is still elevated, and that the increase is intended to support a return to its 2% inflation goal.
For North Texas buyers and sellers, the biggest question is simple: What does this mean for mortgage rates and the housing market?
The Fed Does Not Directly Set Mortgage Rates
One of the most important things to understand is that the Federal Reserve does not directly set 30-year mortgage rates. Mortgage rates are influenced by Treasury yields, mortgage-backed securities, inflation expectations, lender pricing, and broader financial-market conditions.
That means a Fed rate increase does not automatically translate into an identical increase in mortgage rates. However, tighter monetary policy can contribute to higher borrowing costs when bond yields and inflation expectations are also moving higher.
Mortgage Rates Were Already Moving Higher
Mortgage News Daily reported that its average top-tier 30-year fixed mortgage rate was 7.24% on September 16. Its daily index also showed approximately 6.82% for FHA loans and 6.84% for VA loans. Actual rates vary by borrower, lender, loan type, credit profile, down payment, points, and other factors.
The important takeaway is that buyers were already facing a higher-rate environment before the Fed announcement, and affordability remains a major part of the homebuying decision.
What This Means for North Texas Buyers
Higher rates can reduce buying power because more of the monthly payment goes toward interest. That does not necessarily mean buyers should stop looking. It means the strategy matters more.
- Shop the full payment, not just the sales price. Property taxes, homeowners insurance, HOA fees, and the mortgage rate all affect affordability.
- Compare lenders. Rate, fees, discount points, and loan programs can vary significantly.
- Ask about seller concessions. In some transactions, sellers may be willing to contribute toward closing costs or an interest-rate buydown.
- Know your options. Conventional, FHA, VA, and down-payment-assistance programs may produce very different monthly-payment scenarios.
In a market where buyers are more payment-sensitive, negotiation can become just as important as the list price.
What This Means for North Texas Sellers
Sellers should also pay attention to the rate environment. When monthly payments rise, some buyers become more selective or reduce their target price range.
That makes accurate pricing, strong presentation, and flexibility increasingly important. A properly priced home may still attract motivated buyers, while an overpriced property can sit longer when affordability is already stretched.
Depending on the transaction, a seller concession that helps a buyer reduce closing costs or obtain a temporary or permanent rate buydown may sometimes be more valuable than a small price reduction. The right approach depends on the property, the buyer, and the loan structure.
A Note for Veterans and VA Buyers
Veterans using VA financing should remember that VA loan pricing varies by lender and borrower qualifications just like other mortgage products. VA loans can still provide important advantages for eligible borrowers, including no required down payment in many cases and no monthly private mortgage insurance.
The rate environment makes it even more important to compare offers and evaluate the entire loan package rather than focusing only on the advertised interest rate.
The Bottom Line
The Fed’s quarter-point increase adds another layer of pressure to an already challenging affordability environment, but it does not change the basic real estate question: Does buying or selling make sense for your goals, finances, and timeline?
For buyers, this is a market where preparation and negotiation matter. For sellers, pricing and strategy matter more than ever.
If you are considering buying, selling, or relocating in North Texas, TexasVet Realty Group can help you look at the numbers, the market, and the available options before you make a decision.
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Sources: Federal Reserve — September 16, 2026 FOMC Statement; Reuters — September 16, 2026; Mortgage News Daily — Daily Mortgage Rate Index.
This article is for general informational purposes only and is not financial or lending advice. Mortgage rates, qualification requirements, and program terms vary by borrower and lender.