July Market Rate Update
Each month, the IAACU Small Business Team aims to provide you with insights into the current trends in Commercial Real Estate market rates, which are influenced by movements in the US Treasury yield.
Market Overview: Signs of Stabilization in Treasury Yields
Following a modest dip in June, the 5-year U.S. Treasury yield has shown signs of stabilizing in July. Over the past 30 days, the yield has averaged approximately 3.92% with daily closes ranging from 3.79% to 3.99%. This represents a slight decline from June's average of around 4.10%, suggesting a pause in the upward momentum seen earlier this summer.
Market Outlook
Looking ahead, the 5-year Treasury is expected to hover between 3.85% and 4.00% through the remainder of July, barring any major surprises from inflation reports or Federal Reserve commentary. Although short-term volatility remains possible, the market appears to be digesting prior rate hikes and adjusting to a more neutral stance.
Implications for Commercial Real Estate Financing
With the 5-year Treasury yield easing slightly, commercial real estate loan rates have become more attractive. This environment continues to support competitive financing for high-quality assets, especially for borrowers with strong credit profiles and stabilized properties.
If current trends hold, loan rates for strong deals are expected to fall within the 6.30% to 6.90% range during July. This reflects both the current Treasury environment and lenders' continued appetite for well-positioned assets.
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Read our June Market Rate Update.
*Rates from Resource Center | U.S. Department of the Treasury as of July 15, 2025.
