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New Homes Are the Most Affordable They’ve Been in 5 Years: Here’s What Buyers Need to Know.
The median price of a newly built home has fallen to about $390,000, the lowest since 2021, and entrylevel homes have dropped nearly 3% in the past year alone. But the savings don’t stop there: 60% of builders are offering incentives including closing cost help, free upgrades, rate buydowns, and price
cuts averaging 5%. This is a real opportunity for first-time buyers and anyone who thought new construction was out of their budget.

Shoot me a message to find out what’s available in the area.

Why Experts Say Mortgage Rates Should Ease Over the Next Year

Mortgage rates have finally started to come down, and experts say they could dip even further over the next year. The key indicator to watch is the 10-year Treasury yield, which has long been tied to mortgage rate trends.

The Connection Between Mortgage Rates and Treasury Yields
For more than 50 years, the 30-year fixed mortgage rate has closely followed the 10-year Treasury yield, a major benchmark for long-term interest rates. When the yield rises, mortgage rates tend to rise. When it falls, mortgage rates typically drop.

The difference between the two, known as the “spread,” usually averages around 1.76 percentage points. Recently, that spread has been much wider due to economic uncertainty, which has kept mortgage rates higher than normal.

Good News: The Spread Is Narrowing
That wide spread has started to shrink as inflation cools and the economic outlook becomes more stable. This is a positive sign for buyers and homeowners alike. As 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 Also Expected To Drop
It’s not just the spread showing improvement. The 10-year Treasury yield itself is forecast to decline in the coming months. When you combine a narrowing spread with a lower yield, both forces work together to ease mortgage rates.

Right now, the 10-year Treasury yield is around 4.09%. If it continues to move lower and the spread returns to its normal range, mortgage rates could settle near the upper 5% range by late next year.

Of course, future rates will still depend on broader economic factors like inflation, job growth, and Federal Reserve policy. While ups and downs are inevitable, most experts agree the long-term outlook points toward gradually declining rates.

Bottom Line
Mortgage rates are likely to continue easing through next year, giving buyers and homeowners more flexibility. To stay informed and plan your next move, connect with a trusted agent or lender who can track market shifts and guide you through your best financing options.