Mortgage rates have shot up beyond 7% for the first time in more than a year.
Several sites that track mortgage rates on a daily basis reported reaching the threshold this week. At Mortgage News Daily, the index for a 30-year fixed-rate mortgage hit 7.08% by midday Friday, while U.S. News posted an average interest rate of 7.104% based on data from Zillow.
What U.S. News labeled “a sudden jump in mortgage rates” is being attributed to the market’s negative reaction to a buyback program of U.S. government bonds proposed by the U.S. Treasury Department as well as increasing oil prices.
Mortgage rates are more closely tied to the yield on 10-year government bonds but are also affected by the actions of the Federal Reserve. A rate hike by the Fed next week is seen as increasingly likely.
Even the weekly average rate for the same type of mortgage was up 0.05 percentage points Thursday to the highest level since June 2025, reaching 6.76%, according to the Federal Home Loan Mortgage Corporation, better known as Freddie Mac.
The last time the weekly average rate was above 7% was in January 2025.
Before the U.S. and Israel launched the ongoing war against Iran in late February, mortgage rates had been on the decline, dipping below 6% for the first time since 2022. CNBC estimated the subsequent rate increases have added $244 to the monthly payment on a $433,000 home.
Should house hunters wait for mortgage rates to fall?
Mortgage rates reached record lows during the COVID-19 pandemic that saw a homebuying frenzy, falling below 3%. But Utah housing experts don’t advise waiting for rates to come down that far.
“I don’t think that we’ll see a decrease in interest rates anytime soon. I don’t think anybody is anticipating returning to the 3% market,” Steve Waldrip, the governor’s senior adviser for housing strategy, said at a recent University of Utah Kem C. Gardner Policy Institute event.
Waldrip said because mortgage rates were at an “artificial low” for years, some 75% of the housing market is now locked up. Homeowners who bought or refinanced when rates were less than half of what they are now don’t want to give up their mortgages, he said.
A senior research fellow at the institute, Dejan Eskic, said there have only been “maybe two times in our housing history that it was worth waiting,” in the 1980s, when mortgage rates were in the double digits, and in the aftermath of the 2008 financial crisis.
Eskic, co-author of the institute’s new report on the state’s housing market that found home ownership remains out of reach for many Utahns, said the cost of what goes into a home, from construction materials to labor to land, keeps getting more expensive.
“It doesn’t wait. It just continues. So maybe you’re making a trade-off to hope for interest rates to come down, which is not a guarantee,” he said, adding what is guaranteed is that “the longer you wait, the higher the price goes, basically.”