U.S. mortgage rates rose for the fourth consecutive week to their highest level in a year, according to infohub.kz.
The benchmark 30-year fixed-rate mortgage averaged 6.66% this week, up from 6.58% last week, Freddie Mac said. A year ago, the rate was 6.72%. The 15-year fixed-rate mortgage also increased to 6.04% from 5.96% last week, compared to 5.85% a year earlier.
Rising mortgage rates are driven by the Iran war, which has pushed crude oil prices sharply higher and fueled inflation expectations. The 10-year Treasury yield, a key indicator for mortgage rates, stood at 4.66% at midday Thursday, up from 3.97% in late February.
The Federal Reserve left its key interest rate unchanged last week, but three regional Fed presidents dissented in favor of higher rates to combat inflation. Anthony Smith, senior economist at Realtor.com, said the Fed's next move is more likely a rate hike than a cut, making near-term rate relief unlikely.
Higher mortgage rates have weighed on the housing market. Sales of previously occupied homes are hovering close to a 4-million annual pace, extending a slump that began in 2022. Mortgage applications fell 6.4% last week, according to the Mortgage Bankers Association. MBA CEO Bob Broeksmit noted that elevated borrowing costs remain a challenge this summer for many prospective homebuyers.