For the week ending 4/20/23, mortgage rates increased 12bp to 6.62%.
For a $100,000 loan, the monthly payment increased $8 to $640/month or $0.26/day.
Mortgage rates increased 12bp and 10-year Treasury rates increased 9bp. The net difference resulted in an increase of 3bp in the spread to 308bp. With the historical spread being 168, there now exists a “safety cushion” of 140bp above the historical spread.
The historical spread between the 10-year Treasury and mortgage rates is 168bp (see green line, right axis), and currently, there is a 140bp difference above the historical norm. For this spread to return to the historical norm, either mortgage rates will need to decrease further or 10-year Treasury rates will need to increase. The last time spreads were this large (Nov 10, 2022), mortgage rates decreased by 100bp over the following 12 weeks.
