WASHINGTON–Mortgage rates closed last week by rising for the fourth straight week, hitting their highest levels since September 2025 and reversing what had been a trend toward a warming home sales and mortgage market headed into Spring.
The average rate for a 30-year fixed mortgage was 6.38% this week, up from 6.22% last week, according to Freddie Mac.
As the CU Daily reported earlier, mortgage rates had fallen below the 6% threshold for in late February for the first time since 2022, before changing course. Market analysts said the war in Iran and the subsequent increase in oil prices have expectations the Federal Reserve will keep short-term interest rates higher for longer than many had been predicting.
Timing Couldn’t be Worse
Home builders and market analysts said the timing couldn’t be worse for the housing market, which has been muted for three years now. March typically marks the start of the busiest stretch of the year for home sales. Many families want to buy and sell homes in the spring so they can move over the summer.
“It’s weighing on the consumer,” Robert McGibney, chief executive of home builder KB Home, said during an earnings call, according to the Wall Street Journal, adding that the Middle East conflict is denting already low consumer confidence. “The last couple of weeks have been a little softer than what we would like to see or what we normally get this time of year.”
Decline in Mortgage Apps
Mortgage applications for home purchases fell 5% last week compared with the previous week, according to the Mortgage Bankers Association.
“Generally, you don’t see a half-point jump in the span of a week or two,” Matt Vernon, head of consumer lending at Bank of America, told the Journal. “The fact that it’s moved so quickly—buyer reaction has been mixed, for sure.”
The Journal noted, however, that rates are still lower than a year ago, when they stood at 6.65%.
