Trump's Iran War Fallout Drives Mortgage Rates to 6.38% Peak
Mortgage rates are climbing again across the United States, hitting 6.38% for a 30-year loan as global conflict feeds into housing costs. The increase comes at a critical moment for buyers entering the spring market.
The latest jump marks the fourth straight weekly increase, reversing a brief drop below 6% that had improved affordability earlier this year. Now, rising borrowing costs are raising new concerns for both buyers and lenders.
According to Freddie Mac data reported by AP News and MarketWatch, rates climbed from 6.22% the previous week, reaching their highest level in more than six months. The increase is being linked to inflation fears tied to the ongoing Iran conflict.
But the situation is not stabilizing. Analysts say the war has pushed oil prices higher, which in turn is driving up Treasury yields—the key benchmark for mortgage rates—while also reducing expectations that the Federal Reserve will cut interest rates anytime soon.
“The war’s inflation impact is delaying rate relief,” Mortgage Bankers Association economist Michael Fratantoni said.
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The ripple effects are already showing. Mortgage applications have dropped, refinancing activity is falling, and affordability pressures are intensifying for first-time buyers already priced out by high home values.
The broader concern is duration. If energy prices remain elevated or the conflict expands, economists warn that mortgage rates could stay higher for longer, prolonging the housing slowdown and limiting recovery.
For now, markets are watching inflation data, oil prices, and any signs of de-escalation in the Middle East as key indicators of where rates go next.
The next few weeks could determine whether this surge stabilizes or accelerates further.
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