US mortgage rates rise to highest level since June 2025
The average rate on a 30-year fixed-rate mortgage in the United States rose by 6 basis points on Monday to 6.87%. This is the highest level since June 2025, CNBC Top News reports.
According to the outlet, oil prices rose after the resumption of hostilities in the war with Iran, contributing to higher bond yields. Mortgage rates rose along with them.
Rate dynamics
According to Mortgage News Daily, the average rate has added 12 basis points since Thursday and more than 30 basis points over the past two months. At the end of February, one day before the start of the war, the rate on a 30-year fixed-rate loan was 5.99%.
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Mortgage News Daily Chief Operating Officer Matthew Graham noted that rates had been rising gradually. Among the factors, he named inflation expectations, a significant volume of bond issuance, and the resilience of the economy. It had previously been expected that rates would decline this year, but the war with Iran and rising oil prices changed the situation.
Impact on homebuyers
For the purchase of a $450,000 home, which roughly corresponds to the national median price, with a 20% down payment, the monthly principal and interest payment on a 30-year mortgage would now be $2,363. This is $207 more than at the end of February.
Higher rates also reduce the number of borrowers who can meet lenders' debt-to-income ratio requirements. At the same time, home prices nationwide rose by 1.5% year-on-year in June after increasing by 1.2% in May, according to the S&P Cotality Case-Shiller index. CNBC notes that prices are accelerating in some parts of the country due to limited supply. S&P Dow Jones Indices said high financing costs are discouraging owners from giving up previously obtained low mortgage rates.
