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Mortgage rates climb to highest level in a year

Published July 30, 2026 at 8:04 PM UTC

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As of late July 2026, the average U.S. 30-year fixed mortgage rate has risen for the fourth consecutive week, reaching 6.66%, its highest point in a year, according to Freddie Mac. This increase from 6.58% the previous week adds financial pressure on prospective homebuyers, reducing their purchasing power and contributing to sluggish home sales. The 15-year fixed-rate mortgage also rose to 6.04%. These trends are tied to rising 10-year Treasury yields, now at 4.66%, up from 3.97% in February, driven by fears of prolonged inflation exacerbated by the ongoing Iran war and resulting higher oil prices. The Federal Reserve has kept its key rate unchanged but remains divided, with some policymakers favoring more hikes to combat persistent inflation above 2%. The central bank's stance and geopolitical instability suggest no near-term relief for mortgage rates. Consequently, mortgage applications dropped 6.4% last week. The housing market continues to be weak, with home sales hovering near a 30-year low despite a minor increase in the first half of 2026. The possibility of rate decreases remains tied to geopolitical de-escalation, particularly the reopening of the Strait of Hormuz.