Mortgage Rates Rise as War Escalates

Rising Mortgage Rates and Their Impact on the Housing Market

Mortgage rates in the United States have continued to rise for the third consecutive week, signaling a challenging environment for homebuyers and sellers alike. According to data from the Federal Home Loan Mortgage Corporation (Freddie Mac), the average rate for a 30-year, fixed-rate mortgage reached 6.22% for the week ending Thursday. This marks an increase from the previous week’s rate of 6.11%, reflecting a steady upward trend.

The last time the weekly average reached this level was in December 2025, highlighting how quickly the market has shifted. Additionally, the daily index for the same type of mortgage hit 6.43%, as reported by Mortgage News Daily. This figure represents the highest level since last fall and is expected to climb even further later in the week. The daily index rose by 0.07 percentage points from the previous day, showing continued pressure on mortgage rates.

A Shift in Market Conditions

Prior to the recent escalation of tensions between the U.S. and Iran, mortgage rates had dipped below 6% for the first time since 2022. At that point, the housing market was seen as favoring buyers, with more options available and competitive pricing. However, the situation changed rapidly following the conflict in late February, which led to economic volatility and rising oil prices.

This volatility has significantly impacted mortgage rates. According to Zions Bank Mortgage Manager Jeremy Holmgren, the changes are not due to specific factors within the housing market but rather reflect broader trends in the global bond market. He explained that the rising oil prices, driven by supply disruptions in the Middle East, have created a domino effect that influences inflation expectations and, in turn, mortgage rates.

Holmgren noted that while mortgage rates hit a low in February—similar to levels seen during the COVID-19 pandemic—they remain lower than the nearly 8% rates observed in 2023 and the 7% peak from the previous year. However, predicting whether rates will drop once the conflict ends remains uncertain. “There are many factors outside of oil prices that impact mortgage rates,” he said, emphasizing the complexity of the current market.

Challenges in the National Housing Market

Realtor.com senior economist Jake Krimmel highlighted several headwinds currently affecting the national housing market. In a Friday post, he pointed to geopolitical tensions from the Iran war, which are pressuring gas prices and supply chains. Additionally, mortgage rates have been rising for three consecutive weeks, and the Federal Reserve has signaled that future rate cuts are unlikely.

Krimmel noted that lower mortgage rates typically encourage more sellers to list their homes. However, the recent rise in rates and increased economic uncertainty due to the conflict may be deterring some potential sellers. While new listings saw a 2.4% increase in February, overall growth fell by 1.4% year over year. The number of homes for sale has risen by 5.6% compared to the previous year, but the pace of inventory recovery has slowed.

Conclusion

As mortgage rates continue to climb, the housing market faces significant challenges. Buyers and sellers must navigate an environment shaped by global events, economic volatility, and shifting interest rates. With uncertainty remaining high, the path forward for the housing market remains unclear, and both homeowners and prospective buyers are advised to stay informed and adaptable.