Mortgage rates hit 7.49%, a three-year high, as U.S. Treasury yields rise

[Financial News] Rising U.S. Treasury yields pushed the rate on 30-year mortgages to a three-year high.
On the 7th (local time), the Mortgage Bankers Association (MBA) said the average rate on 30-year fixed-rate mortgages for the week ending on the 2nd was 7.49%, up 0.19 percentage points from the previous week. It was the highest level since November 2023.
A survey by Freddie Mac, the government-backed mortgage lender, also found that the 30-year fixed rate stood at 7.28% as of the 1st, its highest level since October 2023. That was nearly 1 percentage point higher than a year earlier (6.34%).
Mortgage rates are closely linked to the yield on 10-year U.S. Treasury bonds.
The 10-year yield rose as high as 5.366% during trading on the 7th amid inflation concerns over a sharp rise in oil prices and solid economic data, setting a new high for the year, before closing at 5.286%.
With the cost of living emerging as the biggest issue ahead of next month's midterm elections, demand for U.S. home loans is also weakening, further worsening affordability.
Mortgage applications fell 4.2% last week from the previous week, dropping to their lowest level since February 2025. Applications to refinance fell particularly sharply.
Joel Kan, the MBA's deputy chief economist, said, “At these rate levels, there are few homeowners with an incentive to refinance,” adding, “The sharp rise in borrowing costs has pushed many prospective buyers out of the home-purchase market.”
Asked by a reporter that day about mortgage rates, President Donald Trump said, “I think the (Fed) board wants the country to fail. Our interest rates should be the lowest.”
Treasury Secretary Scott Bessent, who was also present, blamed high rates on a temporary shock caused by rising oil prices, saying, “Once we get past the Iran conflict, energy supplies will be ample, and mortgage rates and the 10-year yield will come down again.”
[email protected] Lee Seok-woo, International Affairs Specialist Reporter