Mortgage rates surge to highest level since July

Homes in Rancho Cucamonga, California, US, on Saturday, May 9, 2026. Kyle Grillot | Bloomberg | Growing concern over the trajectory of the war with Iran has bond yields rising and mortgage rates following suit. The average rate on the 30-year fixed loan rose 7 basis points Tuesday to 6.75%, according to Mortgage News Daily. That is the highest level since July 31. Rates are now up 33 basis points in just the last 10 days and are 46 basis points higher than their recent April low of 6.29%. That April drop came after a sharp spike in rates at the start of the war, when the rate jumped from 5.99% at the start of March to 6.64% by the end of the month. "Bonds are telling politicians to get serious about ending the war or face increasingly dire consequences," wrote Matthew Graham, chief operating officer at Mortgage News Daily. The move from 5.99% to now 6.75% is a meaningful change in the housing affordability math. For a buyer putting 20% down on a $420,000 home — roughly the national median home price — their monthly principal and interest payment has gone from $2,012 to $2,179, a difference of $167. The nation's homebuilders are slightly less sensitive to rate moves, as the builders have been buying down mortgage rates to get buyers in the door. Rates are still lower than they were a year ago, when they spiked over 7%. …