Rising Oil Prices Drive U.S. Mortgage Rates to Six-Month High

The average U.S. 30-year fixed-rate mortgage has surged to a six-month high due to rising oil prices and Middle East tensions. This increase is impacting home sales during the spring season and highlighting housing affordability as a key political issue ahead of the November midterm elections.

The average rate on the popular 30-year fixed-rate mortgage in the U.S. has soared to a six-month high, driven by escalating oil prices linked to ongoing conflict in the Middle East. The rising inflation concerns may negatively affect home sales during the often-bustling spring season.

Freddie Mac reported on Thursday that the 30-year fixed mortgage rate now averages 6.38%, marking an increase from last week's 6.22%. This is the highest rate since early September, reflecting a continuous rise over the past four weeks, a trend that challenges the Trump administration's efforts to enhance housing affordability.

The mortgage rate dipped to 5.98% before the Iran conflict after President Trump directed Freddie Mac and Fannie Mae to increase purchases of mortgage-backed securities. Since the conflict erupted in late February, oil prices have surged over 30%, pushing U.S. Treasury yields higher. As mortgage rates continue to follow the 10-year Treasury yield trends, housing affordability has become a significant political discussion point as the November midterm elections approach.

(With inputs from agencies.)