Najimah Roberson, a 42‑year‑old daycare owner in Harrisburg, finally secured a five‑bedroom fixer‑upper priced at $340,000 after being outbid nearly 30 times. As the June closing nears, she faces a quoted mortgage rate of 6.8%, far above the sub‑4% loans many owners enjoy. She hopes closing before rates rise.

The surge stems from the Treasury market’s reaction to Trump’s Iran war and higher oil prices, which pushed the 10-year Treasury yield to about 4.6%—levels not seen since 2006. Traders now see 5% within reach, driving the average 30‑year mortgage above 6.5%. Investors have abandoned bets on another Fed rate cut, betting instead on hikes later this year.

Higher rates have stalled refinancings that surged in early 2024 and chilled new‑home demand, leaving inventory thin and pending sales only modestly up. Mortgage originators report business dropping “overnight,” while renters like Roberson consider staying put as payments exceed $2,500 a month. The market now favors sellers with equity, leaving many would‑be buyers priced out, still in the near term.