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U.S. 30-Year Mortgage Rate Surpasses 7% To Reach Two-Year High

Affordability concerns have also encouraged more borrowers to consider adjustable-rate mortgages, which accounted for 9.8% of mortgage applications.

The rate on a 30-year mortgage climbed to 7.12% last week. Pic via(@business)

The average U.S. 30-year fixed mortgage rate climbed to 7.12% on Sept. 18, reaching its highest level since 2024, according to the Mortgage Bankers Association.

Rising borrowing costs have added pressure to homebuyers as higher Treasury yields, influenced in part by elevated global oil prices, increase the cost of residential lending.

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The higher rates are weighing on housing activity, with Colorado home sales falling 11.3% in August and pending contracts declining 3.7% from a year earlier.

Affordability concerns have also encouraged more borrowers to consider adjustable-rate mortgages, which accounted for 9.8% of mortgage applications.

The increase comes after the Federal Reserve raised its policy rate by a quarter percentage point to a range of 3.75% to 4.00%.

While higher rates continue to challenge the housing market, analysts see potential long-term opportunities in some housing-related stocks, particularly for investors with a five- to 10-year investment horizon.

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