Mortgage rates in the United States have surpassed 7% for the first time in nearly two years, as the housing market continues to reel from the ongoing Iran war.
The average 30-year mortgage rate rose from 6.3% to 7.03% in the span of a year, mortgage-loan company Freddie Mac said Thursday. The new data marks the first time that the average mortgage rate has exceeded 7% since January 2025.
The rate was below 6% in late February, but it began rising again once the U.S. launched the war against Iran.
Rising fuel prices stemming from the conflict in the Middle East are putting pressure on mortgage rates by driving up 10-year Treasury yields amid surging inflation.
The newly announced mortgage rate is the highest it’s ever been during either of President Donald Trump’s two terms. The average 30-year rate hit 7.04% four days before Trump took office last year. Three days after his second inauguration, the rate slightly dropped to 6.96% and continued steadily falling as time went on.
Fallout from the Iran war is responsible for the sharp turnaround.
‘SLOGGING ALONG’: PROSPECTS FOR THE HOUSING MARKET IN THE YEAR AHEAD
The news is concerning some experts in economics and real estate amid an already struggling housing market.
“For buyers and sellers, the highest mortgage rates in more than a year and a half are landing on a market that is in the midst of a slowdown,” Anthony Smith, a senior economist at Realtor.com, wrote in an article before the release of Thursday’s data. “Existing home sales hit their 2026 low in August and pending sales have turned negative year over year. A 7% handle is as much psychological as mathematical, and it arrives at the point in the season when leverage usually shifts toward buyers.”
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[ H/T Washington Examiner ]
