How it works
Most U.S. buyers use a mortgage: a loan secured by the home. You pay interest on the borrowed amount, and your equity is the home's value minus what you still owe. Equity grows two ways: paying down the loan, and the home's value changing (which can go either direction). Because the loan is usually much larger than the down payment, price changes are magnified on your equity, in both directions.
The most-quoted rate benchmark is Freddie Mac's Primary Mortgage Market Survey (PMMS). It's a national average built from thousands of loan applications submitted to Freddie Mac, for conventional, conforming, single-family purchase loans. It's not a quote for any one borrower.[1]
History in numbers
Freddie Mac has published the 30-year average weekly since April 1971.[1] From its historical data file:[2]
Record high (Oct 9, 1981): 18.63%
Record low (Jan 7, 2021): 2.65%Source: Freddie Mac PMMS historical data (CSV), downloaded Oct 13, 2026
The FHFA House Price Index tracks single-family values using repeat sales on the same properties, with data back to the mid-1970s across all 50 states and over 400 cities.[3]
A documented example: the 2006–2009 bust
Housing was the epicenter of the Great Recession (December 2007–June 2009). Home prices fell approximately 30% on average from their mid-2006 peak to mid-2009. In response, the Fed bought agency mortgage-backed securities, aimed partly at lowering the cost of credit for home purchases.[4] That's the clearest modern lesson that home prices don't only go up.
Watch out: risks
- Leverage cuts both ways: a price drop can wipe out a small down payment's worth of equity (see 2006–2009 above).
- Rate risk: rates have ranged from 2.65% to 18.63% in the PMMS record, which changes what the same payment can borrow.
- Illiquidity & costs: homes take time and money to sell, and come with taxes, insurance and maintenance.
- Local ≠ national: national averages hide big regional differences.
Sources
- Freddie Mac, Primary Mortgage Market Survey
- Freddie Mac, PMMS historical data
- FHFA House Price Index
- Federal Reserve History, "The Great Recession"
All fetched Oct 13, 2026.