Mortgage rates jump as Iran conflict hits housing market

Core Insights - Mortgage rates have increased significantly due to geopolitical tensions, particularly the ongoing conflict in Iran, with the average rate on a 30-year fixed mortgage rising to 6.38% from 6.22% last week [1] - The housing market is showing gradual improvements year-over-year, with an increase in purchase and refinance applications [2] - The average rate on a 15-year fixed mortgage also rose to 5.75% from 5.54% last week [2] Factors Influencing Mortgage Rates - Mortgage rates are influenced by various factors, including the Federal Reserve's policies and geopolitical events, although they closely track the 10-year Treasury yield [3] - The 10-year Treasury yield has increased to around 4.38%, driven by inflation fears related to the conflict, which is putting upward pressure on mortgage rates [4] - Elevated energy prices are affecting the overall economy, increasing production and delivery costs, which in turn makes borrowing more expensive [5]