Business March 20, 2026

Data Centers Top Offices as Iran War Sends Mortgage Rates to 6.22%

In February the average 30-year fixed mortgage rate fell to 5.98%

Mortgage rates today stand at 6.22% for the third consecutive week, according to Freddie Mac, after briefly falling below 6% in February. The 30-year mortgage rate is now at its highest point since early December, driven by the Iran war pushing energy prices higher and lifting inflation expectations across markets. The 10-year Treasury yield climbed from 3.96% before the conflict to roughly 4.28% this week, and since mortgage rates follow Treasuries closely, borrowing costs for homebuyers moved with it.

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Data Center Construction Tops Offices in the US for the First Time Ever

Mortgage rates dipped below 6 percent in February – Source: The New York Times

What the Iran War Is Doing to Mortgage Rates

The mortgage rates Iran war connection runs through oil. Iran’s effective blockade of regional energy exports sent fuel costs climbing, which fed inflation fears and pushed Treasury yields higher. Mortgage applications fell 10% last week, according to the Mortgage Bankers Association.

MBA CEO Bob Broeksmit had this to say:

“Whether this upward pressure on rates – tied to Middle East tensions – will temper what should be strong spring demand remains to be seen.”

Oxford Economics chief US economist Michael Pearce stated:

“Before the war, we had expected a gradual recovery. With the war, that’s going to delay any recovery. The longer this goes on, the more it’s likely to affect buyer behavior.”

30-year fixed mortgage rate chart showing climb to 6.22% as of March 19 – Source: CNN

NAHB chief economist Robert Dietz noted that fuel accounts for roughly 3% of single-family home construction costs, adding:

“With headline risk remaining elevated, whether it’s tariffs or international issues, that is a headwind.”

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Data Center Construction Tops Offices for the First Time

Data center construction in the US hit $45.1 billion, surpassing offices at $43.5 billion, the first time in history that milestone has been crossed. Since ChatGPT launched in November 2022, data center construction is up 228% while office construction has dropped 38% over the same period. The same war keeping the 30-year mortgage rate elevated is accelerating the AI infrastructure buildout, with mortgage rates today reflecting a broader economic shift driven by geopolitical pressure.

General Office vs Data Center Construction chart showing the crossover – Source: X / @KobeissiLetter

The Fed held rates steady at its Wednesday meeting, and markets now expect more than a year before the next cut. For homebuyers already dealing with mortgage rates the Iran war has made worse, that timeline offers little relief.

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