Mortgage rates are determined by various factors, including the 10-year Treasury yield. Economists predict the 10-year Treasury yield will hover near 4.5% for the remainder of 2025, declining to 4.1% by 2027. The spread between Treasurys and mortgage rates has historically been around 2.5 percentage points.

Analysts expect the 10-year Treasury to remain near 4.1% through 2027. The Congressional Budget Office forecasts the Treasury yield to be 4.1% by the end of 2025, down to 4% in 2026, and near 3.9% through 2029. Historical data suggests a spread of 2.1 to 2.3 percentage points between Treasurys and mortgage rates.

GPT-5 recommends a spread of 2.1 to 2.3 percentage points for the next five years. While forecasts indicate mortgage rates will not hit 3% in the near future, external factors like a recession or unexpected events could alter the trajectory. Adjustable-rate mortgages may offer flexibility in changing rate environments.

Read more at Yahoo Finance: What’s next? Mortgage rate predictions for the next 5 years