This page is part of our Federal Reserve Meeting History series, tracking how national policy shifts impact the local Kansas City housing market.
Last Updated: February 3, 2026
Following a series of strategic rate cuts in late 2025, the Federal Reserve began 2026 by hitting the “pause” button. On January 28, 2026, the Federal Open Market Committee (FOMC) voted to maintain the federal funds rate at a target range of 3.50% to 3.75%.
For Kansas City homebuyers and homeowners, this decision signals a shift from the rapid volatility of the previous two years toward a period of “healthy normalization.” While the market was hoping for continued easing, the Fed’s cautious stance suggests that mortgage rates will remain stable as we enter the spring buying season.
Key Takeaways from the January 2026 Decision
- The Pause: After three consecutive cuts in late 2025, the Fed is waiting to evaluate the “lag effect” of their previous policy changes.
- Economic Resilience: Chair Jerome Powell noted that while inflation is nearing the 2% target, a robust labor market allows the Fed to be patient.
- Internal Dissent: The 10-2 vote revealed slight friction, with two members advocating for a further 0.25% cut to get ahead of potential cooling in the housing sector.
Impact on Kansas City Mortgage Rates
While the Fed doesn’t set Kansas mortgage rates or Missouri rates directly, their “hold” provides a benchmark for the bond market. Here is how the local KC metro is reacting:
1. Stabilization in the Low 6% Range
The “Lock-In Effect” that previously restricted inventory in neighborhoods like Overland Park and Lee’s Summit continues to fade. With the Fed holding steady, 30-year fixed conventional rates in Kansas City have found a comfortable floor between 6.0% and 6.3%.
2. The 10-Year Treasury Yield
Local pricing remains tightly correlated with the 10-Year Treasury yield. Because the Fed signaled they are likely done raising rates for this cycle, the “uncertainty premium” has vanished, leading to the most predictable pricing environment KC has seen in years.
3. Refinance Windows Remain Open
For those who purchased homes in early 2025 at rates near 7%, today’s stabilized environment offers a strategic opportunity. Explore our Kansas City refinance guide to see if a “rate and term” refi makes sense for your current balance.
Kansas City Market Snapshot: February 2026
| Loan Product | Avg. KC Rate* | Local Trend |
|---|---|---|
| 30-Year Fixed | 6.15% | Stable |
| 15-Year Fixed | 5.35% | Stable |
| FHA / VA 30-Year | 5.75% | Slightly Down |
*Rates are estimates based on top-tier credit and 20% down. For live pricing, visit our Kansas City Office page.
Looking Ahead: The March Meeting
The next FOMC meeting is scheduled for March 17-18, 2026. Current sentiment suggests another “hold” is likely unless inflation data drops significantly in February. Our latest December 2025 analysis predicted this plateau, and we expect rates to remain in this range through the first half of the year.
Expert Advice: Don’t try to “time the bottom.” In the competitive KC market, inventory often moves faster than the Fed. Locking in a rate in the low 6s now allows you to secure a home before the spring rush increases competition in high-demand areas like Johnson County and the Northland.
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