The 30-year fixed-rate mortgage rose to the highest level since August 2025

Home buyers are feeling the squeeze due to higher mortgage rates.

Mortgage rates edged up to the highest level in a year, delivering a fresh blow to the housing market.

Mortgage rates jumped 6 basis points to an average of 6.55%, according to new data on Thursday from Freddie Mac. That's the highest level for the 30-year rate since late August, about 11 months ago.

Even an increase of a couple of basis points can push up home buyers' borrowing costs by a several hundred dollars a month.

Mortgage rates are sensitive to political news. The 30-year mortgage rate rises and falls in tandem with the 10-year Treasury yield BX:TMUBMUSD10Y.

Over the last week, bond investors have digested political news regarding tensions with Iran, fresh inflation data, surging oil costs and more.

It's unlikely that the 30-year mortgage rate will fall meaningfully anytime soon, experts said.

"Our midyear forecast still calls for mortgage rates to ease modestly over the second half of the year, and this week's inflation data supports that view over the long run, but the near-term path remains hostage to how the Iran situation develops," Hannah Jones, a senior economist at Realtor.com, said in a statement.

Higher mortgage rates are sapping the life out of the housing market.

Persistently high rates have led to a decline in future home sales. On Thursday, the National Association of Realtors reported that pending home sales fell 5.4% in June from the previous month. Pending sales is a measure of the level of home sales under contract and therefore offers an indication of the direction of actual home sales.

"The highest mortgage rates in nearly a year and the record-high national median home price together are contributing to a tepid housing market that is especially difficult for first-time homebuyers," NAR's chief economist Lawrence Yun said in a statement.

-Aarthi Swaminathan

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July 16, 2026 12:04 ET (16:04 GMT)

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