The average 30 year fixed mortgage rate soared to 7.45% on Thursday, marking the highest level since April 2024. This spike follows a surge in the US 10 year Treasury yield, which climbed above 5.2% for the first time since summer 2007, with some session highs reaching 5.1685%. The rapid rise in yields increased borrowing costs across the US economy, causing mortgage rates to breach a critical 7% psychological threshold.

Beyond housing, rising rates are affecting auto loans and personal borrowing, while many banks are hedging holdings of bonds that yield under 5% to avoid selling them at losses. Market volatility has intensified as refinancing becomes increasingly difficult for households and small businesses, with some analysts attributing the instability to geopolitical tensions and fiscal pressures.