Freddie Mac shares have fallen sharply in recent sessions, dropping more than 8% over the past five trading days to reach their lowest level since November 2023. Investors are reacting to President Trump’s proposal to issue new government-backed mortgage bonds through the Treasury Department rather than pursue an IPO for Fannie Mae and Freddie Mac. Analysts at Morgan Stanley estimate that keeping the companies under conservatorship could save the government up to $100 billion in annual servicing revenues, but would delay any capital returns to private investors and maintain higher regulatory capital requirements for the GSEs.

Freddie Mac’s Primary Mortgage Market Survey® reported that the average rate on a 30-year fixed-rate mortgage declined to 6.06% as of January 15, 2026, down from 6.16% the prior week and sharply below last year’s 7.04%. The 15-year fixed rate also slipped to 5.38% from 5.46% a week earlier (versus 6.27% a year ago). Freddie Mac’s Chief Economist Sam Khater noted that purchase applications have risen approximately 12% and refinance activity by roughly 18% over the last week, signaling an uptick in housing market momentum ahead of the spring sales season.

With mortgage rates now back near early-2022 levels, Freddie Mac stands to benefit from higher loan origination volumes, but the company’s profitability will hinge on its ability to hedge interest rate risk and manage credit performance. The ongoing conservatorship means that any excess earnings continue to be swept to Treasury, limiting dividend distributions. Investors will be watching Freddie Mac’s upcoming earnings release for updates on loan book growth, prepayment speeds and credit loss reserves, as well as commentary on potential legislative efforts to reform the GSEs’ capital structure.