US mortgage rates top 7% for first time in 20 months
News Source
β’Thu, 24 Sep 2026 16:31:58 GMT
π° What Happened
US mortgage rates have gone above 7 percent for the first time since January 2025. Freddie Mac, the federal lender, reported the rise. The 30-year rate is the one most Americans use to buy a home.
The increase followed the Federal Reserve's decision to raise interest rates for the first time since 2023, which it blamed on high inflation. The Fed is trying to slow rising prices.
On 16 September the Fed lifted rates by a quarter of a point, to a range of 3.75 to 4 percent. Most of its rate-setters expect at least one more rise this year.
π The Backstory
The 30-year mortgage rate had been falling from 7.79 percent in late 2023. But rates have crept up since late February, when the US and Israel went to war with Iran.
That war pushed inflation to its highest level in three years and sent energy prices higher. Brent crude oil topped $105 on Thursday. Petrol and heating bills went up along with it.
The 10-year US Treasury yield hit its highest level since July 2007 on Thursday. Wages have not kept pace with rising prices. Home sales have been slow all year, and August was the weakest month of 2026 so far.
π― Why It Matters
Higher rates make monthly home loan payments bigger, so fewer people can afford to buy. The anger is likely to show at November's midterm elections. Housing costs are a top concern for voters.
US mortgage rates have gone above 7 percent for the first time since January 2025. Freddie Mac, the federal lender, reported the rise. The 30-year rate is the one most Americans use to buy a home.
The increase followed the Federal Reserve's decision to raise interest rates for the first time since 2023, which it blamed on high inflation. The Fed is trying to slow rising prices.
On 16 September the Fed lifted rates by a quarter of a point, to a range of 3.75 to 4 percent. Most of its rate-setters expect at least one more rise this year.
The 30-year mortgage rate had been falling from 7.79 percent in late 2023. But rates have crept up since late February, when the US and Israel went to war with Iran.
That war pushed inflation to its highest level in three years and sent energy prices higher. Brent crude oil topped $105 on Thursday. Petrol and heating bills went up along with it.
The 10-year US Treasury yield hit its highest level since July 2007 on Thursday. Wages have not kept pace with rising prices. Home sales have been slow all year, and August was the weakest month of 2026 so far.
Higher rates make monthly home loan payments bigger, so fewer people can afford to buy. The anger is likely to show at November's midterm elections. Housing costs are a top concern for voters.