Are mortgage rates continuing to rise?

KEY TAKEAWAYS

• Mortgage rates reached 6.53% this week, the highest in nine months, according to Freddie Mac.
• A slight drop to 6.59% was noted amid a lower-than-expected rise in an inflation indicator.
• The rise comes amid heightened concerns that prices will keep rising due to the war in Iran.

SALT LAKE CITY — Mortgage rates were up again this week and remain at the highest level in nine months.

The weekly average rate for a 30-year fixed-rate mortgage has now reached 6.53% as of Thursday, according to the Federal Home Loan Mortgage Corporation, better known as Freddie Mac.

The latest increase comes after last week's sharp jump in rates amid heightened concerns that prices will continue to rise due to the war in Iran. A week ago, the average rate climbed 0.15 percentage points, from 6.36% to 6.51%.

Slight improvement in daily mortgage rates

A daily tracker that had posted rates as high as 6.75% last week showed a slight drop as of midday Thursday, to 6.59%. The 0.02 percentage-point drop, measured by Mortgage News Daily, was attributed to an inflation indicator that was not as high as expected.

Still, a Mortgage News Daily post on Thursday noted, "the market remains focused primarily on supertankers being able to transport oil. Those prospects were dealt a fresh blow overnight as both sides reported renewed attacks."

Mortgage rates are closely tied to long-term Treasury bond yields, which have been driven up since the U.S. and Israel launched attacks against Iran in late February, all but halting a significant portion of the world's tanker traffic.

Now, mortgage rates, which had slipped below 6% for the first time since 2022 just before the start of the war, are taking a toll on the housing market. Redfin, an online real estate brokerage, reported Thursday that pending home sales were down for a second straight week.

Why pending US home sales are down

A Redfin post blamed high mortgage rates for a 1.5% decline in pending home sales on a seasonally adjusted basis for the week ending May 24. Pending sales were also down the previous week, following four weeks of increases.

Home prices are heading up, too, with the median monthly housing payment now at an 11-month high of $2,637, according to Redfin. The combination is adding to concerns about the economy that surfaced when President Donald Trump imposed sweeping tariffs last year.

Polls then showed many Americans, including in Utah, were hesitant to buy a home or other big-ticket items.

"Financial uncertainty is playing a role, too," Redfin posted, noting "some would-be homebuyers are jittery about making a huge purchase when the economy feels shaky and consumer confidence is at an all-time low."

The Key Takeaways for this article were generated with the assistance of large language models and reviewed by our editorial team. The article, itself, is solely human-written.

Related topics

Utah housingIran conflictInflationUtahSalt Lake County

Lisa Riley Roche

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