Quick Take: 10-Year Treasury Yields and Mortgage Rates

After reaching 4 percent on a 10-year Treasury yield in early June, the benchmark interest rate has fallen to 3.3 percent in recent days. That drop was partly due to stock market sell-offs and a demand for safe assets from a renewed uncertainty regarding the strength of economic recovery during the past month.
The decline in the 10-year benchmark yield nearly always moves the average 30-year mortgage rate in equal proportion. The last week’s average rate was 5.2 percent and it could be a bit lower today and this week. Since 30-year mortgages are the only ones that consumers are after in the current times, such a meaningful drop in rates raises affordability for home buyers.
A 0.7 percentage point drop translates into a decline on a monthly mortgage payment by $88 per month on a $200,000 mortgage.

What does today’s data mean for REALTORS® and consumers? – find out more at realtor.org