U.S. 30-Year Mortgage Rate Hits Highest Level Since June 2025 Amid Rising Oil Prices

The average rate on a 30-year fixed mortgage increased by six basis points on Monday to 6.87%, according to Mortgage News Daily, marking the highest level since June 2025 and a 12-basis-point rise since Thursday. The climb follows a surge in oil prices after renewed hostilities in the Iran war, which has lifted bond yields and, in turn, mortgage rates.

Mortgage News Daily chief operating officer Matthew Graham said the rise is not a sudden spike but a gradual increase driven by inflation expectations, elevated bond issuance and continued economic resilience, all of which could change in the future.

At the end of February, before the conflict escalated, the 30-year rate stood at 5.99%. For a median-priced home of $450,000 with a 20% down payment, the monthly principal-and-interest payment would now be about $2,363, roughly $207 higher than in late February.

Higher rates also tighten debt-to-income ratios, limiting borrower eligibility, while home prices have begun to rise again in some markets due to limited supply. The S&P CoreLogic Case-Shiller index showed a 1.5% year-over-year increase in June, up from 1.2% in May.

"As financing costs are kept high for prospective buyers, current homeowners remain reluctant to give up the low mortgage rates secured in prior years," said Rebecca Kaufman, associate director of commodities at S&P Dow Jones Indices, in a news release.