A fifth straight weekly climb in Freddie Mac's 30-year benchmark puts fresh strain on purchase pipelines and broker conversations
Mortgage rates have pushed past 7% for the first time in 20 months. That gives mortgage brokers a harder pitch just as the fall buying season gets underway.
The 30-year fixed-rate mortgage averaged 7.03% as of September 24, up from 6.95% a week earlier, according to Freddie Mac's Primary Mortgage Market Survey.
The benchmark last topped 7% on January 16, 2025, at 7.04%. A year ago, it stood at 6.30%.
The 15-year fixed-rate mortgage, often favored by refinancing borrowers, climbed to 6.42% from 6.26%. It averaged 5.49% a year earlier.
"The housing market remains supported by a solid labor market and an economy that is growing at a healthy rate," said Sam Khater, chief economist at Freddie Mac.
Why are mortgage rates rising?
The jump follows the Federal Reserve's September 16 decision to raise the federal funds rate by a quarter point, to a range of 3.75% to 4%. It was the central bank's first hike since July 2023. Most policymakers expect at least one more increase before year-end.
Bond markets are doing most of the work. Lenders use the 10-year Treasury yield as a guide for pricing 30-year loans, and on Thursday it reached its highest level since July 2007. That extended a sell-off that pushed Treasury yields to a 19-year high earlier this month.
The yield opened 2026 near 4.15% and now sits around 5.15%.
Energy prices have added to the pressure. Oil has surged since the war between the US and Iran began in late February, which lifted inflation expectations. The same forces closed a brief window that month, when the 30-year average dipped to 5.98%.
What 7% means for purchase pipelines
"Beyond the immediate financial constraints, the 7% threshold is a foreboding psychological barrier," said Lisa Sturtevant, chief economist at Bright MLS.
"Crossing this mark could create a chilling effect on the market, leading to home sales transactions to slow considerably this fall."
Demand is already softening. Pending home sales fell 4.7% year over year in August, according to the National Association of Realtors (NAR).
Borrowers are also shifting toward adjustable-rate mortgages (ARMs), which carry a fixed rate for an initial period before resetting.
Mortgage applications fell 1.5% for the week ending September 18, as the 30-year fixed rate hit 7.12%, its highest point since May 2024.https://t.co/02M12WmOsU
— Mortgage Professional America Magazine (@MPAMagazineUS) September 23, 2026
The Mortgage Bankers Association (MBA) said ARMs made up 9.8% of applications for the week ending September 18.
Lawrence Yun, chief economist at NAR, put it bluntly in a blog post last week: "Expect 7% as the new normal."
Bill Dallas, chairman of Dallas Capital, has been pressing clients to accept that reality.
"Look, you've been in this mess for a while, and the low-rate cavalry, you kept praying that these guys are going to show up," Dallas said in an interview on why the low-rate cavalry isn't showing up. "I've tried to tell my clients that that's not going to happen."
"What I'm trying to get them to think about is, guys, this is structural," he said.
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