Today's Mortgage Rates

Today's Mortgage Rates

  • Dennis Hartley
  • 08/22/23

Today's Mortgage Rates

Unfortunately, there’s no easy way to predict what mortgage rates will do in the future; however, there is one very good indicator of what might happen, and that’s the relationship between the 30-Year Mortgage Rate and the 10-Year Treasury Yield.

The graph below shows those two metrics since 1972. Historically, the average spread between the two over the last 50 years was 1.72 percentage points. If you look at the trend line you can see when the Treasury Yield trends up, mortgage rates will usually respond. And, when the Yield drops, mortgage rates follow. While they typically move in sync like this, but lately that spread is widening far beyond the norm.

Factors such as inflation, other economic drivers, and policy decisions from the Federal Reserve (The Fed) are influencing mortgage rates and widening the spread. It means, based on the normal historical gap between the two, that there is room for mortgage rates to improve if the Fed stops raising interest rates, which is soon likely.

Most experts believe that "rates peaked last fall and will decline—to some degree—later this year, barring any unforeseen surprises.” Let's see how it plays out. In the meantime, contact me with any real estate questions, I am here to help.


Graph courtesy of Keeping Current Matters.

Lead Photo by Kostiantyn Li on Unsplash

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