July 30, 2026 | The Impact of Rising Interest Rates

The 30-year Treasury yield surged to a 19-year high of 5.21% today after investors rejected Fed Chairman Kevin Warsh’s decision to hold rates steady – choosing instead to dump bonds in response to rising inflation data.

12.3% Mortgage Rates by 2027?

In my May 2026 Timing Letter, I made the case for mortgage rising to 12.3% by 2027.  

The forecast was based on an 84% probability that inflation would rise to 8.5% to 10%, and the 3.8% historical spread that lenders require above actual inflation in order to survive. 

Record Home Prices, 6.66% Rates Crush Affordability

U.S. housing affordability has already deteriorated to a near-historic low, driven by the compounding pressure of record-high home prices alongside a recent surge in 30-year mortgage rates to 6.66% (Freddie Mac).

The American housing market stands at a dangerous tipping point.  A shortage of inventory for sale have kept valuations pinned to record highs, leaving buyers highly sensitive to sudden bond market shifts. If inflationary pressures force financing costs back toward historic peaks, the mathematical impact will be devastating.

Eroding the American Dream.

If rates rose to 12.3% and U.S. housing prices remained unchanged, the PI payment on a $100,000 mortgage at 12.3% would be 63% greater than at 6.66%.  This would price an even higher number of buyers out of the housing market.

Robert Campbell July 30th, 2026

Posted In: The Campbell Real Estate Timing Letter

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