Freddie Mac’s latest Primary Mortgage Market Survey showed the 30-year rate rising from 6.95% a week earlier, while the 15-year fixed rate increased to 6.42% from 6.26%. A year ago, the respective averages stood at 6.30% and 5.49%.
That leaves the 30-year mortgage at its highest level since January 2025 and well above the sub-6% levels briefly seen earlier this year.
Treasury Yields Keep Mortgage Rates Elevated
The main source of pressure remains the bond market.
The U.S. 10-year Treasury yield climbed above 5%, reaching roughly 5.08% Tuesday and touching its highest level since 2007. Longer-term yields have surged as investors price in persistent inflation, strong economic growth and the possibility that interest rates remain higher for longer.
Mortgage rates do not move directly with the Federal Reserve’s benchmark rate. Instead, lenders pay close attention to longer-term bond yields and mortgage-backed securities when pricing loans.
That relationship has already driven a steady increase from the 6.71% mortgage rate recorded earlier this month.
Buyers Are Already Pulling Back
Higher rates are feeding directly into weaker housing demand.
Mortgage applications fell 1.5% during the week ending Sept. 18, according to the Mortgage Bankers Association. Purchase applications dropped 1%, while refinancing activity fell another 3%.
New-home demand has also weakened. Applications to purchase newly built homes fell 5.5% year over year in August and declined for a fifth consecutive month, reaching their lowest level of 2026.
The deterioration follows months in which Treasury yields kept mortgage costs elevated, limiting the relief buyers received from slower home-price growth.
Housing Affordability Remains Tight
The affordability picture is becoming increasingly difficult because borrowing costs are rising even as home prices refuse to fall meaningfully.
U.S. single-family home prices increased 0.3% in July and 2.6% from a year earlier, according to the FHFA. That means buyers are dealing with both higher financing costs and still-rising property prices.
There has been some modest relief: the median monthly mortgage payment requested by purchase applicants slipped to $2,162 in August from $2,175 in July. But the MBA said higher mortgage rates continue to offset much of the benefit from smaller loan balances.
