On January 11, 2026, home equity line of credit (HELOC) and home equity loan rates reached or neared their lowest levels over the past 52 weeks, signaling a shift in consumer borrowing dynamics. The decline supports increased demand for home equity financing.
- HELOC rates reached 5.8% on January 11, 2026, near a 52-week low
- Fixed home equity loan rates declined to 6.2% during the same period
- A 0.7-percentage-point drop from Q3 2025 reflects easing borrowing costs
- Lenders report rising demand, particularly in high-equity markets like Austin and Denver
- Projected 12% increase in home equity withdrawals over next six months
- Lower rates may stimulate consumer spending and support construction and retail sectors
Home equity loan and HELOC rates across major U.S. lenders have declined to near 52-week lows as of January 11, 2026, with average HELOC rates falling to 5.8% and fixed home equity loan rates dipping to 6.2%. These figures represent a 0.7-percentage-point drop from the previous quarter and mark the most favorable borrowing conditions in over a year. Lenders report a noticeable uptick in applications for home equity products, particularly in markets with strong housing value appreciation such as Austin, Denver, and Seattle. The decline follows a broader trend of moderating inflation and a pause in Federal Reserve rate hikes, which has eased pressure on lending rates. Financial institutions have responded by lowering margins on second-lien products to remain competitive. This shift benefits homeowners with substantial equity, enabling them to access funds for renovations, debt consolidation, or education expenses at historically low costs. The current rate environment is expected to boost consumer spending and support housing market resilience. Analysts project a 12% increase in home equity withdrawal activity over the next six months, driven by lower borrowing costs and rising home values. This could provide a tailwind for retail, construction, and home improvement sectors. Market participants are monitoring the sustainability of low rates, especially as inflation data and labor market indicators remain closely watched. Any reversal in monetary policy direction could quickly alter the outlook for home equity financing.