The US 30-year mortgage rate has risen to 6.66%, reaching a one-year high.

US mortgage rates have climbed to their highest level in nearly a year as ongoing conflict in Iran continues to fuel inflation concerns. Coupled with the Federal Reserve maintaining its current stance but signaling possible rate hikes, the outlook for the real estate market faces increasing pressure.

According to data released by mortgage giant Freddie Mac on Thursday, the average 30-year fixed mortgage rate rose from 6.58% last week to 6.66%, reaching its highest level since July 31, 2025.

The current rate has rebounded sharply from the end-of-February low that briefly fell below 6%, with rising energy prices driven by Middle Eastern conflicts seen as a major contributor.

The Federal Reserve announced on Wednesday that it would keep the benchmark interest rate unchanged, but three officials voted in favor of a rate hike. As a result, the yield on 30-year US Treasury bonds climbed to a nearly 19-year high, and the yield on 10-year bonds hovered close to a one-year peak. With borrowing costs under sustained upward pressure, there is little room for mortgage rates to ease in the short term.

In terms of market impact, Redfin data shows that, in the four weeks ending July 26, US signed home sales fell to their lowest level since early April. Meanwhile, the sales divide between luxury and entry-level homes is becoming increasingly pronounced, reflecting deeper economic inequality within the US housing market.

The rise in mortgage rates is closely linked to the recent climb in US Treasury yields, with geopolitical uncertainty being a key driving force.

Anthony Smith, Senior Economist at Realtor.com, noted that Iran's peace talks appeared promising in early July but have since broken down. "Markets are once again reacting to uncertainty, and the inflationary pressure brought about by higher oil prices is part of that," he said.

On the monetary policy side, the Federal Reserve kept rates steady on Wednesday, but three dissenting votes supported a rate hike, putting increasing pressure on Fed Chair Waller to consider further tightening measures.

Smith pointed out that since the Fed's next move is more likely to be a rate increase than a cut, there is little chance for mortgage rates to ease in the near term.

Persistently high borrowing costs have left a clear mark on the real estate market.

The current round of mortgage rate increases began at the end of February this year, when rates briefly dipped below 6%. They have since climbed alongside escalating Middle Eastern tensions, leading to a disappointing performance during the usual spring homebuying season, with weakness continuing.

Lisa Sturtevant, Chief Economist at Bright MLS, commented following the Federal Reserve meeting, "Buyers are waiting to see how things develop as the housing market enters its seasonal slowdown."

She also pointed out that, although most indicators show sluggish transaction activity, if some buyers rush to lock in deals due to fears of further rate hikes, there may be a surprising rebound in demand toward the end of summer.

Under macroeconomic pressure, internal divisions in the US housing market are becoming more evident.

According to a report by Zillow, in May this year, luxury home sales grew by 6.2% year-on-year, while entry-level home sales decreased by 5.4%. Luxury buyers are more likely to pay in cash and are less sensitive to interest rates, which partly explains the divergence between the two segments.

This split is most pronounced in San Francisco, where the wealth effect from AI company stocks continues to drive high-end home sales up by 21.6%. Entry-level transactions slipped just 1.2%, but more sellers have begun to reduce their prices.

Kara Ng, Senior Economist at Zillow, commented, "Today's entry-level buyers have more options, greater bargaining power, and sellers more willing to make concessions. The challenge is that the same financial pressures make it harder to save for a down payment and take advantage of these opportunities."