12/31/2025
As we wrap up the year, here’s what’s happening with interest rates and housing this year
• The 10-year Treasury dropped from about 4.6% to around 4.1%
• Short-term rates fell even more
• That has translated into roughly ¾% lower mortgage rates compared to earlier this year for many conventional loans
The bond market still expects rate cuts on the short end, while longer-term rates remain cautious due to inflation concerns. Importantly, there is no discussion of rate hikes.
The Federal Reserve remains split on how aggressively to cut rates in 2026, but recent data shows:
• Job markets remain stable
• Home prices nationally have leveled off
• Some regions are seeing price declines, which could help cool housing inflation
Bottom line:
Rates are steadier, affordability has improved, and the setup for 2026 looks better than the last couple of years.
If you’re thinking about buying, refinancing, or planning your next move, clarity matters more than headlines.
Wishing everyone a healthy, happy New Year.
