Mortgage rates climb above 7% as bond yields surge, deepening U.S. housing gridlock

Mortgage rates climbed above 7% this week, the highest since President Trump returned to the White House. The 10‑year Treasury yield closed Friday just below 5.2%, the highest in more than two decades, driving up borrowing costs for everyone else.

The rise in rates affects sellers and buyers. Home prices have been climbing for more than three years, and about half of homeowners have mortgage rates below 4%, so many are staying put. For buyers, more homes on the market could put them in a stronger bargaining position if they can stomach 7% rates.

The surge in rates is linked to a resilient U.S. economy, low unemployment, solid retail spending, and AI investment. Fed Governor Michael Barr said growth is strong, the labor market is solid, and inflation is above the 2% target. Rising interest rates make borrowing more expensive, but the cost of living is still high.

Read the full story at wcmu.org.