HousingWire’s Mortgage Rates Center put the average 30-year conventional loan at 6.85% on Tuesday, a hair under the 6.86% of a week earlier. FHA 30-year loans rose 10 basis points to 6.55%. Jumbo 30-year loans fell 3 basis points to 6.84%.
So rates sat in the upper 6% range for the week. The reasons for that are oil and the Middle East, plus a Federal Reserve meeting on July 29.
Oil, the 10-year and the Fed
Industry experts told HousingWire that mortgage rates track the 10-year Treasury yield, and that yield has climbed as rising oil prices and conflict in the Middle East revived fears of lasting inflation.
“Mortgage rates moved lower last week as inflation data came in better than expected, but we’ve also seen how quickly the outlook can change,” said Benjamin Cohen of Rate. Charles Goodwin of Kiavi said hawkish Fed commentary and renewed oil worries had pushed rates back into the mid-6% range. He expects them to hold there “barring any breakthroughs in the Middle East, easing inflation data, or very weak labor data.”
The CME Group’s FedWatch tool showed 82.4% of traders expecting no change in the benchmark rate after the July 29 meeting, down from 88% the week before. Goodwin said numerous Fed members and Chair Warsh were focusing “more on the inflation narrative than the labor narrative.”
Sarah DeFlorio of William Raveis Mortgage said higher Treasury yields have wiped out much of the recent improvement. Many had hoped Warsh’s appointment would mean lower rates, she said, but the “unpleasant reality of the macro global environment” makes that “particularly difficult to do.”
Mike Nielsen of Churchill Mortgage pointed to a resilient economy and stubborn inflation. “The combo of a decent economy with the current inflation numbers just doesn’t add up to a low-rate market,” he said. His colleague Kevin Watson tied rates to fighting in the Middle East and worries about oil moving through the Strait of Hormuz. “I wouldn’t expect to see relief on mortgage rates until 2027,” Watson said, adding that it would take a new ceasefire that actually holds.
Grace Maxwell of Canter Financial described the mechanics: the more uncertain investors are, the bigger the spread they demand.
Buyers and prices
Clear Capital’s June Home Data Index showed national home prices up 2.2% from the previous quarter, with every region posting gains. Kenon Chen of the firm said monthly payment burdens look more manageable than headlines suggest when set against history, though rising insurance costs and HOA fees still squeeze buyers.
Marc Halpern, CEO of Foundation Mortgage, said buyers are dealing with high rates, prices, insurance premiums and property taxes all at once. He advised them to compare lenders, ask for seller concessions, and look at rate buydowns, adjustable-rate mortgages and other loan types. “They should not postpone a sound purchase solely to time the rate market,” he said.
