Why Experts Say Mortgage Rates Could Ease Over the Next Year
If you’ve been keeping an eye on mortgage rates here in the Omaha area, you’ve probably noticed they’ve started to come down a bit — a welcome change for anyone thinking about buying or selling in places like Papillion, Elkhorn, Bennington, Council Bluffs, or Lincoln.
The big question now is: will rates keep falling, and how much lower could they go?
According to national and local experts, there’s still room for rates to ease over the next year. One of the main indicators to watch is the 10-year Treasury yield — here’s why that matters.
The Connection Between Mortgage Rates and the 10-Year Treasury Yield
For more than 50 years, the 30-year fixed mortgage rate has moved closely with the 10-year Treasury yield, which is a key benchmark for long-term interest rates.
When the Treasury yield goes up, mortgage rates usually follow. When it drops, mortgage rates tend to come down — a pattern that’s held true for decades.
Experts track the difference between these two numbers — called the spread — which historically averages around 1.76 percentage points (or 176 basis points).
The Spread Is Starting To Shrink
Over the past couple of years, that spread has been unusually wide. Why? Because when the economy feels uncertain — like we’ve seen recently — investors get cautious, and that gap widens.
That’s been one of the reasons rates in Nebraska’s housing markets have stayed higher than normal. But here’s the good news: the spread is beginning to narrow as the economy stabilizes and inflation cools.
According to a recent Redfin report:
“A lower mortgage spread equals lower mortgage rates. If the spread continues to decline, mortgage rates could fall more than they already have.”
That’s great news for homebuyers in Omaha and nearby communities, where affordability has been top of mind for many families.
The 10-Year Treasury Yield Could Also Come Down
It’s not just the spread showing promise — the 10-year Treasury yield itself is expected to dip further in the coming months. When you combine that with a narrowing spread, it sets up a scenario where mortgage rates could ease gradually through 2026.
Right now, the 10-year Treasury yield sits around 4.09%. Adding the typical spread of 1.76% would suggest mortgage rates around 5.85% — right in line with many forecasts calling for upper-5% territory by late next year.
Of course, these numbers can shift as the economy, job market, and inflation evolve — but overall, the outlook for rates across the Greater Omaha and Lincoln metro areas is looking more positive than it has in quite some time.
Bottom Line
Keeping track of these economic factors can feel overwhelming — and that’s where having a trusted local real estate agent or lender makes a big difference.
If you’re planning to buy, sell, or refinance in Omaha, Papillion, Elkhorn, Bennington, Council Bluffs, or Lincoln, let’s connect. I’ll help you stay up to date on the latest mortgage trends and create a strategy that fits your goals in today’s shifting market.
