Mortgage rates took another leg up today, rising ever closer to 6.50%.
The culprit once again has been the conflict in the Middle East, which has sent oil prices surging higher.
That leads to inflation, whether it’s higher gas prices or higher input costs on goods and transporting said goods.
Bonds don’t like inflation, so mortgage-backed securities (MBS) prices fall and their yield (aka interest rate) rises.
That’s what we’ve been seeing since the beginning of March and it might get worse before it gets better.
The 30-Year Fixed Is Back on the Cusp of 6.50%
The latest daily reading from Mortgage News Daily puts the popular 30-year fixed at 6.43%, up from 6.36% yesterday.
That’s the highest point of 2026, with the previous high being 6.41% on Friday March 13th.
It also tells you (or at least me!), that a 6.50% 30-year fixed is simply a matter of time.
Not a matter of if, but when. We are banging on the door and the trend certainly feels higher before lower.
As I said a week or so ago, mortgage rates stop trending lower and began trending higher, something that hasn’t happened for a very long time.
Had there not been this conflict in Iran, mortgage rates would likely be well below 6% today.
Instead, we’re facing the worst rates since nearly August, which is terrible news for prospective home buyers and those looking for a rate and term refinance.
Given there’s no sign of a resolution anytime soon, I would bet on mortgage rates moving higher before they move lower.
How high is another question, but ideally they don’t go much higher as this is perhaps a “transitory” issue.
Both oil prices and mortgage rates jumped up unexpectedly on the Iranian news, but could settle down for the same reasons since it’s one specific issue as opposed to a widespread economic narrative shift.
Could Mortgage Rates Reach the 7% Range Again?
Is a return to 7% mortgage rates possible?
What once felt unthinkable is now back on the table thanks to geopolitics.
I don’t think we go quite that high, though I do think mortgage rates keep moving higher in the short- and medium-term.
In other words, I definitely think we blow past 6.50% any day or week now, at least by MND’s measure.
And chances are we go even higher than that as the months go on.
That could mean a 30-year fixed at 6.625%, 6.75%, or even 6.875%, but I don’t foresee a 7% 30-year fixed again.
Sure, anything is possible, but I think a lot of what has transpired is already mostly baked into 10-year bond yields.
They were sub-4% in late February and closer to 4.30% today. That’s a big jump in a short amount of time that reflects what’s currently happening.
Bond yields could re-test 4.50% levels as this drags on and if mortgage spreads are around 200 basis points (2.00%) or slightly higher, you can foresee a 6.75% rate.
But getting to 7% seems like a stretch.
If we did get back to a 7% mortgage rate and it made the headlines, I think it would be too much for the housing market to bear.
Best-case scenario right now is rates settle down soon and don’t move much higher.
It won’t be great for the spring home buying season, but staying below year-ago levels can still be viewed as a win.
Before creating this site, I worked as an account executive for a wholesale mortgage lender in Los Angeles. My hands-on experience in the early 2000s inspired me to begin writing about mortgages 19 years ago to help prospective (and existing) home buyers better navigate the home loan process. Follow me on X for hot takes.