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Home shoppers holding out for relief from rising mortgage rates may be in for a long wait.
The weekly average rate on a 30-year fixed-rate home loan has been rising for months and this week climbed to just below 7% -- its highest level in over 19 months.
The benchmark 30-year fixed rate mortgage rose to 6.95% from 6.76% last week, mortgage buyer Freddie Mac said Thursday. One year ago, the average rate was 6.26%.
This is the fourth week in a row that mortgage rates have moved higher. The average rate hasn't reached this level since Jan. 30, 2025.
Borrowing costs on 15-year fixed-rate mortgages, often sought by borrowers refinancing a home loan, also rose this week. That average rate increased to 6.26% from 6.09% last week. A year ago, it was at 5.41%.
Higher mortgage rates can add hundreds of dollars a month to borrowers' costs, limiting home buyers' purchasing power. As rates rise, that can also lead prospective home shoppers to delay buying.
In late February, the average rate on a 30-year mortgage briefly dipped to 5.98%, its lowest level going back to late 2022. The nearly 1 percentage point increase in the rate since then translates roughly into an additional $255 a month cost for a borrower financing a $400,000 home loan at the current average rate.
The housing market has been stuck in a rut this year in large part because of rising borrowing costs, as mortgage rates have kept marching higher in the months since the war between the U.S. and Iran began in late February. Expectations of higher inflation amid surging oil prices have pushed up the long-term bond yields that lenders use as a guide to pricing home loans, driving mortgage rates higher.
Mortgage rates are influenced by inflation, Federal Reserve policy and bond-market investors' expectations for the economy, among other factors. They generally follow the trajectory of the 10-year Treasury yield. That yield, which was at 3.97% in late February, before the war began, breached 5% on Monday for the first time since 2023. It was at 4.94% at midday trading on the bond market Thursday.