Mortgage Rates in US Hit 9-Month Record: Sparks Major Index Dips

Key Takeaways

• The US 30-year mortgage rate increased to 6.51% this week, hitting a nine-month high,
• Mortgage rates and Bond yields have spiked as investors grow more worried about prolonged inflation and the Iran War
• Major US stock indices dipped on Thursday in response to the climb, including the Nasdaq, S&P 500 and Dow Jones Industrial Average

The US 30-year mortgage rate increased to 6.51% this week, hitting a nine-month high, according to the Fannie Mac. Major US stock indices dipped on Thursday in response to the climb. The tech-heavy Nasdaq Composite (^IXIC), benchmark S&P 500 (^GSPC), and blue-chip Dow Jones Industrial Average (^DJI) declined 0.3%, 0.3%, and 0.2%, respectively, in recent trading in response. Yesterday, the three indexes all rose at least 1% ahead of Nvidia’s earnings, however, those upswings have since been reversed.

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No End in Sight for Mortgage Rate Hikes: What’s Sparking the Climb

The increases in the 30-year mortgage rate doesn’t appear to be slowing down either, as inflation continues to surge. The average rate on a 30-year fixed mortgage rose from 6.36% last week, Fannie Mac said Thursday. The timing couldn’t be worse either, as now is a usually busy time for homebuyers to get active. As a result of that and rising costs, many would-be buyers are on the fence.

Bond yields have also climbed in the past week, as investors continue to worry about prolonged inflation and the ongoing conflict in Iran. The 10-year Treasury yield, which mortgage rates closely track, has risen roughly 15 basis points in the last week to around 4.6%.

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Additionally, the mortgage rate hike come as a relative surprise, considering the lower rates seen as early as February 2026. Rates began to decline late 2025 after the Federal Reserve started easing short-term interest rates. Further, mortgage rates dipped below 6% in February, boosting expectations for a busy spring. However, after the latest CPI report revealed that inflation remains in play, mortgage rates have since increased. Furthermore, the Fed is reportedly considering resuming interest rate increases this year, which could keep the mortgage rate hike pattern going.

“Each uptick in rates narrows the pool of buyers who can make the numbers work,” said Anthony Smith, senior economist at Realtor.com. On the bright side, mortgage rates remain lower than they were at this point last year. Hence, some buyers are taking advantage of the slower market to buy from the lower prices. On the flip side, Mortgage applications for home purchases fell last week compared with the previous week. They did rise 8% year-over-year though, according to the Mortgage Bankers Association.

“Higher Treasury yields continued to push mortgage rates higher last week, weighing on affordability and overall application activity,” MBA president and CEO Bob Broeksmit said in a statement.

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