US 10-⁠yr yield → House prices, 8 economies

Common explanation (Cause · opposite direction): Rising mortgage rates weigh on house prices.

One of the two has no data yet for this issue.

Hot and cold describe position, not good or bad: warm does not mean a fall is coming, and an extreme reading does not mean a quick reversal. We describe history only, with no buy or sell advice.

Where it stands now

Where the two indicators stand this issue

US 10-⁠yr yield: 2.09 percentage points above its 10-year average. House prices, 8 economies: Median position across economies 22.

Tests

Does this link hold up?

Common explanationRising mortgage rates weigh on house pricesSource: International Monetary Fund, “House Prices Continue to Fall as Borrowing Costs Rise” (2023).
Tested against our dataAgreement between the positions of US 10-⁠yr yield and House prices, 8 economies (12-month lag), measured in the direction of the common explanation: +0.01 (an opposite-direction link: the raw correlation is −0.01, and a negative correlation fits, so the sign is flipped). Looking at every 5-year period (shifted one year at a time), the two moved in that direction in 1 of 8. Not visible in our data
Periods when it did not holdAcross 8 5-year periods, out of step in 1988⁠–⁠2021.

History

The two lines, overlaid

Data: Federal Reserve H.15, via FRED (Federal Reserve Bank of St. Louis); Bank for International Settlements (BIS), residential property prices (inflation-adjusted). Positions: our calculation.

US 10-⁠yr yieldHouse prices, 8 economies

Limits

What this card cannot tell you

Moving together does not prove that one causes the other.
Links change over time; periods when this one did not hold are listed in full.
This is the historical record, not a forecast.

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