The Fed Holds at 3.75% to 4%, but Two Members Wanted a Hike

On October 28, the Federal Reserve held its target range for the federal funds rate at 3.75% to 4%. The Fed rate decision passed 10 to 2, and both dissenters wanted a quarter-point increase, not a cut. For buyers, mortgage rates follow longer-term Treasury yields more than this range, so the payment you can lock on homes available now matters more than the next meeting.

What the Fed rate decision said

The Federal Open Market Committee statement, released at 2:00 p.m. on October 28, 2026, kept the range at "3-3/4 to 4 percent." Lisa D. Cook and Beth M. Hammack voted against. Both "preferred to raise the target range for the federal funds rate by 1/4 percentage point at this meeting." The hold followed a quarter-point increase on September 16, approved 12 to 0.

• Growth: "Economic activity is expanding at a strong pace."
• Jobs: "Job gains have kept pace with the workforce, and the unemployment rate has changed little."
• Prices: inflation is still running above the goal, per the statement.
• Spending: "Domestic spending has been resilient," though the committee flagged uncertainty tied in part to geopolitical developments.

The statement did not commit to a next step. It said more information will help the committee choose a stance that brings inflation back to its 2 percent goal in a timely way.

Growth came in strong a day later

A day after the meeting, the Bureau of Economic Analysis reported that real GDP grew at a 3.4% annual rate in the third quarter of 2026. That followed 2.2% in the second quarter. The committee met before that release, but its own statement had already described activity as expanding at a strong pace. The statement does not give the two dissenters' reasons.

"Plan on today's rates, not forecasts. Two members already voted for higher, so a cut is not a safe bet," said Bryan De Bruin, CEO of Red Cedar Homes.

Why mortgage rates track the 10-year Treasury

The federal funds rate is an overnight rate; the effective rate was 3.88% on October 29, per the Fed's H.15 release. A 30-year mortgage is priced off longer-term money. NAHB's Eye on Housing put it plainly: "Mortgage rates depend more directly on longer-term bond yields and mortgage market conditions."

The Fed's H.15 release shows where those long rates sit.

• 10-year Treasury, October 23: 5.00%
• 10-year Treasury, October 28 (decision day): 5.05%
• 10-year Treasury, October 29: 4.98%
• Freddie Mac 30-year fixed, October 29: 7.24%

The 10-year rose to 5.05% on decision day and eased to 4.98% the next day. The 30-year average fell 0.08 point for the week, per Freddie Mac. A rate quote depends on the bond market, your credit and your down payment, not on one meeting.

What a December hike would mean

The next FOMC meeting is December 8 to 9, 2026, and it comes with a Summary of Economic Projections. A hike is not decided. If it comes, the first costs to move are short-term ones.

1. Construction and land loans: The Fed describes the bank prime loan rate as "one of several base rates used by banks to price short-term business loans." Prime stood at 7.00% on October 29, three points above the top of the target range. NAHB notes the policy rate "influences builder acquisition, development, and construction lending costs."
2. Fixed mortgages: These respond to longer-term bond yields and mortgage market conditions, per NAHB. Watch the 10-year yield, not only the Fed range.

"Holding costs are real costs. Ask any builder how they plan for them," De Bruin said.

How buyers and builders can plan

For buyers, the decision is the total monthly payment at today's rate. Compare principal, interest, taxes and insurance on a specific home. Our post on what is included in a new construction price shows what sits in a stated price, and new construction vs existing homes compares the two paths.

Our homebuyer process runs about 24 weeks in seven steps. If you are building on your own lot, see what a fee build is and how a published vertical price works.

"If the payment works on the rate you can lock today, a Fed meeting next month should not change the answer," De Bruin said.

Frequently asked questions

Does the Fed rate decision set mortgage rates?

No. The Fed sets an overnight range. Fixed mortgage rates follow longer-term yields such as the 10-year Treasury, which was 4.98% on October 29.

Who voted for a hike in October?

Lisa D. Cook and Beth M. Hammack. Both preferred a quarter-point increase over holding the range at 3.75% to 4%.

When is the next Fed rate decision?

The FOMC meets December 8 to 9, 2026.

See homes you can price today

Rates will keep moving. A finished home has a known price and a known timeline. Browse homes available now in Charlotte, Greenville and Spartanburg, then talk with our team or call 980-890-9381.

Figures as of November 2026. This is general information, not legal or tax advice. Talk to your attorney or CPA about your situation.

Sources

• Federal Reserve: FOMC statement, October 28, 2026
• Federal Reserve: FOMC statement, September 16, 2026
• Federal Reserve: FOMC meeting calendars
• Federal Reserve: H.15 Selected Interest Rates
• Bureau of Economic Analysis: GDP, Third Quarter 2026 (Advance Estimate)
• Freddie Mac: Mortgage Rates Decline Further to 7.24% (October 29, 2026)
• NAHB Eye on Housing: Fed Holds Rates with Two Votes for Another Hike