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Chart of the Day: Mortgage Rates are Back to Normal

Samuel A. Kiburz, Senior Vice President, Chief Investment Officer Jun 3, 2025
Peaks and valleys of mortgage rates shown with blue line

Contents

Today’s Chart of the Day from re:venture shows the difference between mortgage rates and inflation going back to 1955. Economists make the case that the difference is the "true” cost of a loan to the borrower. A 5% mortgage rate at 5% inflation is less costly than a 5% mortgage with only a 1% inflation rate. The lowest was in 2022 with a -4.4% difference while the highest was in 1985 at +11.4%.

Going back 70 years, the historic average is 4%, which is where we are at today. The iron rule of investing is that everything wants to return to the mean, meaning that there is no “pull” to reduce rates to the levels we enjoyed during the last 15 years after the Great Recession.
Chart of the Day

About the Author

Samuel A. Kiburz, Senior Vice President, Chief Investment Officer
Samuel A. Kiburz, Senior Vice President, Chief Investment Officer

Samuel serves as Senior Vice President, Chief Investment Officer for the Crews family of banks. He manages the individual investment holdings of his clients, including individuals, families, foundations, and institutions throughout the State of Florida. Samuel has been involved in banking since 1996 and has more than 20 years experience working in wealth management.

Investments are not a deposit or other obligation of, or guaranteed by, the bank, are not FDIC insured, not insured by any federal government agency, and are subject to investment risks, including possible loss of principal.

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