The US 30-year fixed rate mortgage rose for a third week in a row, increasing by 0.15 percentage points to 6.96% this week, according to Freddie Mac data. It came as financial markets responded to expectations that the Federal Reserve will need to maintain higher benchmark rates for an extended period to combat persistent inflationary pressures.
US 30-year Fixed Rate Mortgage Reach New Heights This Year
According to Freddie Mac, the US 30-year fixed rate mortgage averaged 6.96% in the July 13 week, rising for a third straight week and reaching the highest level since November 2022. That compares to 6.81% in the prior week.

Source: Freddie Mac
In the meantime, according to the Mortgage Bankers Association (MBA), the average contract rate on a 30-year fixed-rate mortgage surged by 22 basis points to 7.07% during the week ending July 7. This represents the highest level since November and leaves the rate just 10 basis points shy of the two-decade high recorded last October.
Economic Uncertainty and the Federal Reserve’s Role
Joel Kan, the MBA’s Deputy Chief Economist, explained that incoming economic data has been sending mixed signals about the state of the economy. Consequently, Treasury yields increased last week as markets anticipate that the Federal Reserve will need to maintain higher rates for an extended period to curb inflation. As a result, mortgage rates across the board followed suit, posing challenges for prospective homebuyers. On the positive side, data released earlier this week, showed that inflation, measured by the consumer price index (CPI), slowed more than expected, leading to a retracement of Treasury yields (a benchmark for mortgage rates).
A Pessimistic Outlook for Low Mortgage Rates
Lawrence Yun, Chief Economist at the National Association of Realtors, cautions that the recent surge in mortgage rates is likely to persist for the foreseeable future. Yun believes that the days of 3% interest rates for 30-year fixed mortgages are behind us and are unlikely to return, potentially spanning decades. While acknowledging the unpredictability of the future, he is convinced that low rates are no longer within reach.
Impact on Mortgage Applications
Although the MBA’s index of refinancing applications declined by 1.3% from the previous week, there was an increase in the home-purchase gauge, contributing to an overall advance in the measure of mortgage applications. The seasonally adjusted Market Composite Index, a measure of mortgage loan application volume, witnessed a 0.9% increase compared to the previous week. However, on an unadjusted basis, the index decreased by 19% compared to the prior week. The Refinance Index also dropped by 1% from the previous week, marking a 39% decline from the same period last year. Conversely, the seasonally adjusted Purchase Index rose by 2% from the prior week, although the unadjusted Purchase Index saw a 19% decrease year-on-year.