Mortgage rates increased this week, with the average 30-year fixed mortgage rising to 6.3%.
The primary factor behind increasing mortgage rates is escalating tensions between the U.S. and Iran that drove oil prices higher.
The 15-year fixed-rate mortgage also moved higher, rising to 5.64 from 5.58 last week.
The rise in current mortgage rates is timely for the spring home-buying season. Current mortgage rates tend to follow the 10-year treasury rate, which has risen sharply recently due to the threat of inflation brought about by high energy prices.
Current mortgage rates dipped below 6% in late February for the first time since late 2022, but after the Middle East conflict began, they rose above 6% and have remained above that level since.
Despite the upward movement, some buyers are pushing ahead. The Mortgage Bankers Association revealed that the number of applications increased to 21% from the same period a year ago.
The Federal Reserve announced on Wednesday, April 29, that it is continuing to hold off on interest rate cuts, referring to high oil prices as a contributing factor.
As of April 30, the current mortgage rates are:
- 30-year fixed at 6.11%
- 20-year fixed at 6.08%
- 15-year fixed at 5.62%
- 5/1 ARM fixed at 6.11%
The yield on the 10-year Treasury bond was at 4.39%, which is an increase compared to 4.34% last week, while it was at 3.97% prior to the outbreak of the Iran war in late February.