Many feel that the real estate market is stalling due to unpredictable interest rates in Modesto. Many people have had their say in when rates might be changing. Some experts are saying we have a good predictor of interest rate behavior.  And it looks like rates are going to continue to drop!

The Treasury Yield

For more than 50 years now, the 30-year fixed mortgage rate has closely followed the trends of the 10-year treasury yield, a benchmark for predicting long-term interest rates.

If treasury yield climbs, interest rates tend to rise as well. And when the yield falls, interest rates typically fall as well.

It’s been a fairly predictable pattern for over 50 years. So predictable that many experts see a normal gap between the two. The gap is known as the spread, and it averages about 1.76 percentage points.

Recent Spread Trends

The past couple of years, the spread has been wider than normal. Why? Some people look at the spread as a measure of the fear in the market. When there’s uncertainty in the economy, the spread widens. This is one of the reasons interest rates have been higher over the past few years.

Even though there is some lingering uncertainty in the economy, the spread is starting to shrink!  As that shrinks, interest rates have the potential to come down. A recent article from Redfin explains:

“A lower mortgage spread equals lower mortgage rates. If the spread continues to decline, mortgage rates could fall more than they already have.”

The 10-Year Treasury Yield Is Expected To Decline

People are also predicting that the 10-year treasury yield will come down in the upcoming months. When you see a lower yield and a narrowing spread, you have two key forces with the potential of pushing interest rates down.

This relationship is a huge reason why you see experts projecting interest rates will decrease, with a slight possibility they’ll get below 6% toward the end of 2026.

It’s important to note, these predictions can change if the economy shifts. All we know for certain, is that there will be shifts along the way. 

How these play out depends on where the economy, the job market, inflation, and more go. But, 2026 is currently expected to give us gradual rate decline. As of now, things are moving in the right direction.

Interests Rates In Modesto Don’t Have To Delay Your Home Sale

Eric with Genesis offers an easy way to sell your home fast without waiting for the interest rates in Modesto to decline.  Cash offers can help you sell your house quickly, for a fair price, without the need for repairs, inspections, or having a line of strangers walk through.   Selling a house on the market can be a long, costly and difficult process.  Selling your house does not have to be.

If a cash offer is what’s right for you, Eric with Genesis is here to help! We can give you a fair cash offer, help with all the legalities, and streamline the process to help get your home sold fast!  Contact Eric today to find out what you can get for your home and how quickly you can get that cash in hand!