US housing market

Average US mortgage rates have climbed above 7% after a sharp rise in Treasury bond yields, worsening an already frozen housing market. Higher borrowing costs are pricing out buyers, discouraging homeowners with lower locked-in rates from selling, and deepening the gridlock between sellers, buyers and lenders. Economists warn affordability could deteriorate further if yields keep climbing.

Average US mortgage rates have risen above 7%, dealing a fresh blow to housing affordability. The increase raises monthly payments for buyers and adds pressure to a market already strained by high home prices and limited inventory, with homeowners locked into lower rates showing little incentive to sell.

FedWatch strategist Ben Emons is forecasting that the 10-year Treasury yield could reach 6% by January 2027. He warns that borrowing costs at that level would squeeze the housing market, putting it "in a crunch," and slow the broader US economy. The call is drawing attention as investors weigh the outlook for interest rates, mortgage rates and growth.

US mortgage rates have climbed above 7% for the first time in 20 months, a milestone for homebuyers already grappling with high property prices. The rise means significantly higher monthly payments on a typical home loan, and is being closely watched as a signal of pressure on the housing market and household affordability across the United States.

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