The Fed Is Split — and Not Toward Cuts
This is the part most buyers get backwards. The June Fed minutes revealed a genuinely divided committee: of the 18 policymakers, nine expect at least one rate hike this year, eight expect no change, and exactly one expects a cut. After the renewed Middle East tensions, futures markets are pricing an 87% chance of a rate hike this year and a 51% chance of two. The Fed’s own scorecard leans toward raising rates, not lowering them.
3.5%
HEADLINE CPI
from 4.2%
2.6%
CORE CPI
from 2.9%
9 of 18
FED SEE A HIKE
1 sees a cut
~0%
ODDS OF A 2026 CUT
market-priced
New Fed Chair Kevin Warsh reinforced the message in his testimony to Congress this week. He tied inflation mostly to supply shocks — energy, tariffs, AI investment — not an overheating economy, which sounds friendly to rates. But he noted the market expects a higher Fed Funds Rate and flagged that the housing sector is still lagging. When the Fed Chair tells Congress housing is the laggard, that’s not a paranoid buyer — that’s the person who sets policy confirming what your clients feel.
The One Number That Decides Your Buyer’s Rate: “the Spread”
A great question came up in a recent agent meeting: if the 10-year Treasury is around 4.6%, why is the 30-year mortgage at 6.7%? What’s the 2%-plus gap? That gap is called the spread — and understanding it separates the agent who blames “the Fed” from the one who can explain the market.
The 10-year Treasury is the wholesale price of money. Everything between it and your buyer’s closing table is the spread. The biggest single piece is prepayment risk: your buyer can refinance any time, for free, but a Treasury can’t be paid off early. That’s a free option handed to the borrower — and investors charge for it. The rest covers the guarantee fee to Fannie and Freddie, servicing, and origination.
Here’s the takeaway that makes you the expert in the room
The spread is a second lever on rates, separate from the Fed. Today it’s running about 2.08% against a historical norm near 1.70%. That means even if the Fed never moves, simply normalizing the spread would lower rates by 35–40 basis points on its own.
It also cuts the other way: in 2023, the 10-year fell while mortgage rates held, because the spread widened at the same time. When a buyer says “rates should be lower,” this is why they sometimes aren’t — and why they can improve without any help from Washington.
This Week’s Rate Watch
| Average Rates | Current | 1 Day | 1 Week | 1 Month | 1 Year |
|---|---|---|---|---|---|
| 30 Yr. Fixed | 6.70% | -0.05% ▼ | +0.07% ▲ | +0.12% ▲ | -0.13% ▼ |
| 15 Yr. Fixed | 6.20% | -0.01% ▼ | +0.03% ▲ | +0.06% ▲ | +0.17% ▲ |
| 30 Yr. FHA | 6.25% | 0.00 – | +0.05% ▲ | +0.11% ▲ | -0.12% ▼ |
| 30 Yr. Jumbo | 6.84% | -0.03% ▼ | +0.06% ▲ | 0.00 – | -0.06% ▼ |
| 7/6 SOFR ARM | 6.35% | -0.02% ▼ | +0.06% ▲ | +0.08% ▲ | +0.08% ▲ |
| 30 Yr. VA | 6.25% | -0.01% ▼ | +0.03% ▲ | +0.09% ▲ | -0.14% ▼ |
▼ green = rate improved
▲ red = rate rose. Change columns show the move over that period, not the rate level.
Source: Mortgage News Daily, 7/14/26.
Spokane Market Watch
Steady, with more room to breathe
Official SAR MLS data, June 2026 (vs. June 2025)
- $430K: Median price (up 1.2% YoY)
- 874: Closed sales • +9.3% YoY
- 20 days: Median days on market
- 98.9%: Of list price received
- 3,605: Active inventory (up 9.4% YoY)
- 4.1 mo: Supply • balanced market
Source: Spokane Association of REALTORS® MLS Market Review, all property types, June 2026 vs. June 2025. More inventory and a balanced 4.1-month supply mean buyers no longer have to waive every contingency to win — a stronger position than they’ve had in years.
Skip’s Take
If you have a buyer who’s been “waiting for rates to drop,” this is the week to reach back out — but not with a promise. The honest message is stronger: the people who set rates are currently more likely to raise them than cut them, so waiting is a bet against the Fed’s own scorecard. A year ago the 30-year was actually higher than today — buyers who waited got no reward and paid a year of someone else’s mortgage. Marry the house, date the rate; when the spread normalizes or the data turns, we refinance. Let’s run your buyers’ numbers together.
Connect With Skip
- Got questions? Reach out to Skip Leasure
*This newsletter is for informational and educational purposes only and is not a commitment to lend, an offer to extend credit, or financial advice. Interest rates and market data are as of the date shown, are subject to change without notice, and represent survey averages rather than a quoted rate for any individual borrower. Actual rates depend on credit, property, loan program, and other factors. Figures: Bureau of Labor Statistics, Mortgage News Daily, the Federal Reserve, and the Spokane Association of REALTORS®.
