US Mortgage Rates Rise to 6.67%, Inflation Concerns Intensified by US-Iran Conflict

On August 14, the average rate for a 30-year fixed mortgage in the United States rose to 6.67%, the highest level in over a year, up from 6.43% in early July and 5.98% before the outbreak of the US-Iran conflict. The increase in the yield on the 10-year US Treasury bonds is one of the main factors driving up mortgage rates, resulting in an average monthly mortgage payment for a typical American home increasing by nearly $150 since the beginning of the year. In the UK, the average rate for a 5-year fixed mortgage rose to 5.66% in July, marking the first month-on-month increase since April. In Germany, the 10-year fixed mortgage rate increased from 3.3% in early July to 3.7% this week, while in France, the 10-year fixed mortgage rate rose from 3.02% in June to 3.15% in July. Market participants believe that the US-Iran conflict has led to rising oil and energy prices, exacerbating concerns about a rebound in inflation and pushing up financing costs such as US Treasury yields and UK swap rates. High interest rates further suppress real estate transactions in Europe and the US, with the low-rate lock-in effect in the US market continuing, and the number of housing sale agreements reached in the UK in July declining by nearly 10% year-on-year.

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