Windermere’s Principal Economist Jeff Tucker looks at mortgage rates and the factors that have pushed them up more than a point since September.

Can’t join us in person at Inman Connect New York? Don’t miss out on the game-changing insights and strategies shared by over 250 industry-leading speakers across 75+ carefully curated sessions. With a Virtual Pass, you’ll get all the tools you need to navigate challenges and seize new opportunities — delivered straight to your screen, wherever you are!

This post was last updated Jan. 21, 2025.

In this exclusive series on Inman, Windermere’s Principal Economist Jeff Tucker illuminates the latest stats, reports and numbers to know this week.

This week the numbers to know are all about mortgage rates and the factors that have pushed them back up.

Number to know: 7%

That’s around the typical interest rate on a 30-year fixed-rate mortgage right now, according to both Freddie Mac and Mortgage News Daily. That’s also almost a full point higher than it was just four months ago in mid-September.

I should add that the daily data have been very volatile lately, with rates jumping up and down by 10 or 15 basis points. But in the bigger picture, this is the first time since last May that Freddie Mac’s weekly survey showed rates above 7 percent.

For the proximate cause of the higher mortgage rates we can look at our second number to know right now: about 4.63 percent, which is the latest 10-year Treasury yield as of Jan. 17. Mortgage rates tend to track closely with this key benchmark long-term yield.

There is a bit of a puzzle here, though: the Federal Reserve has been cutting the Federal Funds Rate, an ultra-short-term overnight interest rate. They started with a supersized half-point cut in September and then two more quarter-point cuts.

As Torsten Slok, Chief Economist at Apollo Global Management, recently flagged in this chart, historically, 10-year Treasury yields tend to continue declining modestly after the Fed has begun cutting the short-term rate. But this time is sharply different – instead, those long-term rates have more than backtracked all the downward progress they made over the summer.

The short answer for why they’ve moved back up is that the outlooks for three factors have climbed recently: real economic growth, inflation and borrowing.

For economic growth, our next number to know is 256,000: That’s the surprisingly large number of new payroll jobs added in December, according to the latest jobs report from the Bureau of Labor Statistics. Aside from October’s hurricane-impacted report, that makes three surprisingly strong months of job gains to close out 2024.

For inflation, our final numbers to know are 2.9 percent and 4.8 percent; those are the year-over-year inflation rate of the consumer price index, and the latest monthly growth rate compounded out to an annualized rate. Both are running hotter than the Fed’s target of 2 percent.

Combined with the surprisingly resilient labor market, these data are tamping down investors’ expectations for further rate cuts by the Fed – all of which is helping to feed into those higher Treasury yields and therefore higher mortgage rates.

This article was updated after publication to reflect more current data. 

Jeff Tucker is the Principal Economist for Windermere Real Estate in Seattle, Washington. Connect with him on X or Facebook

Show Comments Hide Comments
Sign up for Inman’s Morning Headlines
What you need to know to start your day with all the latest industry developments
By submitting your email address, you agree to receive marketing emails from Inman.
Success!
Thank you for subscribing to Morning Headlines.
Back to top
Only 3 days left to register for Inman Connect Las Vegas before prices go up! Don't miss the premier event for real estate pros.Register Now ×
Limited Time Offer: Get 1 year of Inman Select for $199SUBSCRIBE×
Log in
If you created your account with Google or Facebook
Don't have an account?
Forgot your password?
No Problem

Simply enter the email address you used to create your account and click "Reset Password". You will receive additional instructions via email.

Forgot your username? If so please contact customer support at (510) 658-9252

Password Reset Confirmation

Password Reset Instructions have been sent to

Subscribe to The Weekender
Get the week's leading headlines delivered straight to your inbox.
Top headlines from around the real estate industry. Breaking news as it happens.
15 stories covering tech, special reports, video and opinion.
Unique features from hacker profiles to portal watch and video interviews.
Unique features from hacker profiles to portal watch and video interviews.
It looks like you’re already a Select Member!
To subscribe to exclusive newsletters, visit your email preferences in the account settings.
Up-to-the-minute news and interviews in your inbox, ticket discounts for Inman events and more
1-Step CheckoutPay with a credit card
By continuing, you agree to Inman’s Terms of Use and Privacy Policy.

You will be charged . Your subscription will automatically renew for on . For more details on our payment terms and how to cancel, click here.

Interested in a group subscription?
Finish setting up your subscription
×