Average US 30-year mortgage rate rises to 6%, breaking three-week downward trend

U.S. Mortgage Rates Edge Up After Recent Lows

This week, average long-term mortgage rates in the United States rose slightly after reaching their lowest point in over three years. The increase follows a surge in oil prices triggered by the ongoing conflict involving Iran, which pushed bond yields higher.

According to Freddie Mac, the standard 30-year fixed mortgage rate increased to 6% from last week's 5.98%. At this time last year, the rate stood at 6.63%.

This slight uptick ends a three-week period of declining rates, which had hovered near 6% throughout the year. Notably, last week's average marked the first time since September 2022 that rates dipped below 6%.

Mortgage rates are shaped by a variety of influences, including the Federal Reserve’s interest rate decisions and the outlook of bond market investors regarding economic growth and inflation. Typically, mortgage rates move in line with the 10-year Treasury yield, which serves as a benchmark for home loan pricing.

As of midday Thursday, the 10-year Treasury yield had climbed to 4.14%, up from about 4% the previous week.

The recent rise in Treasury yields is largely attributed to higher oil prices, which have intensified inflationary pressures and may delay any potential interest rate cuts by the Federal Reserve.