Mortgage Rates Rise to 5.50%

Mortgage rates have increased 20 bps while 10 Year US Treasuries have also increased by 20 bps, thus the spread remained at 245 bps. As predicted, at the May 4th Federal Reserve meeting, the Fed’s increased the Fed Funds rate by 50 bps.

30 Year Mortgage Rates

MORTGAGE RATES ARE NOW WELL ABOVE 5.00% with an increase of 20 bps to 5.50%. For a $100,000 loan, the monthly payment increased by $12 to $567 which is equal to $0.41 a day.

Rate VS. Spread

Rates rocket up and feather down. The historic spread (aka the difference) between the 10 Year Treasury and mortgage rates is 168 bps (see the green line). At the start of 2022 mortgage rates have increased FASTER than the 10-year Treasury. This past week the 10 Year rate increased 20 bps while Mortgage rates increased 20 bps thus no change in the spread and remain at 77 bps above the historical norm.

Bill Knudson, Research Analyst Landco ARESC