U.S. mortgage rates climbed to their highest level in about 11 months this week, adding pressure on homebuyers as housing prices remain near record levels.
The average rate on a 30-year fixed mortgage rose to 6.58% from 6.55% a week earlier, according to Freddie Mac’s latest Primary Mortgage Market Survey released Thursday. The rate was last at 6.58% on Aug. 21, 2025, and stood at 6.74% a year ago.
The average 15-year fixed mortgage rate also increased to 5.96% from 5.93% the previous week. It averaged 5.87% a year earlier.
“Borrowers should remember that shopping around for a mortgage rate can make a meaningful difference, potentially saving them thousands over the loan’s lifetime,” Freddie Mac Chief Economist Sam Khater said.
Prices Hit Record
The Kobeissi Letter, in a post on X, citing data from Redfin, said the median U.S. home-sale price rose 2.2% year over year in June to a record $408,776, while existing-home sales increased 4.2% from a year earlier.
“US housing affordability is deteriorating again,” the market commentator said.
Redfin’s data showed existing-home sales increased 4.2% year over year to a seasonally adjusted annual rate of roughly 4.4 million, the highest since November 2022. New listings, however, declined 0.8% month over month to 376,762, their lowest level since December.
San Francisco recorded the largest annual price increase among major metros at 9.2%, followed by Pittsburgh at 9.1% and West Palm Beach at 8.6%. West Palm Beach and San Francisco also led gains in closed home sales, rising 23.8% and 23.1%, respectively.
Affordability Squeezed
Elevated borrowing costs have continued to weigh on prospective buyers. HousingWire Lead Analyst Logan Mohtashami said mortgage rates have remained largely within a 6.5% to 6.75% range, with Federal Reserve messaging and geopolitical uncertainty helping keep long-term borrowing costs elevated. Mortgage Bankers Association data showed purchase applications fell 7% as the 30-year contract rate climbed to 6.65%.
“While mortgage rates remain elevated, homebuyers may be better served focusing on the full cost of homeownership rather than trying to guess where rates will be a few months from now,” LoanDepot Chief Investment Officer and Head Economist Jeff DerGurahian told Fox Business. He said inflation and the renewed U.S.-Iran conflict were being reflected in rates as higher oil prices raised concerns about future inflation.
Supply remains another obstacle. Zillow Group Inc. (NASDAQ:Z) estimates the U.S. faces a 4.7 million-home shortage, while labor shortages, elevated construction costs and regulatory hurdles continue to constrain homebuilding.
Financial strain is also showing up among some homeowners. ATTOM data showed U.S. foreclosure filings rose 21% year over year in the first half of 2026 to 227,548 properties, while foreclosure starts increased 18%.
Disclaimer: This content was produced with the help of AI tools and was reviewed and published by Benzinga editors.
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