The increase follows a Federal Reserve decision to raise interest rates, occurring as since 2023, a move attributed to persistent inflation.
On 16 September, rates increased by a quarter of a point, moving into a range of 3.75% to 4%. In updated projections, most members of the Fed’s rate-setting committee indicated they anticipate at least one more rate increase before the year concludes.
Last year, the Freddie Mac 30-year mortgage rate, the standard for home loans nationwide, had been trending downward from a 7.79% peak reached in late 2023, which marked a generational high.
However, rates have been steadily climbing since late February, when the US and Israel initiated their war with Iran. This conflict pushed inflation to its highest point in three years and caused a sharp spike in energy costs.
Brent crude, the global benchmark for oil, rose above $105 earlier on Thursday.
On Thursday, the 10-year US Treasury yield—which serves as the foundation for 30-year mortgage rates and other borrowing costs—reached its highest level since July 2007, while the 30-year Treasury yield hit its highest point since 2004 as investors increased their expectations for another Fed rate hike next month.
Earlier in September, US Treasury Secretary Scott Bessent announced that the Treasury would triple its government debt buyback program, yet yields have continued to climb.
The housing market has long been in a slowdown, said Anthony Smith, a senior economist at
The frustration is expected to show up in November’s midterm elections as Republicans struggle to maintain control of Congress. Nearly three-quarters of Americans disapprove of Donald Trump’s handling of the economy, according to a
