A $450,000 home just got $1,346 more expensive each year

A $450,000 home just got $1,346 more expensive each year. For a borrower taking out a 30-year fixed mortgage with 20% down, that extra cost adds up to $40,000 over the life of the loan. The jump comes as the average 30-year fixed mortgage rate climbed to 6.46%, up from 5.98% in late February—before the US-Israeli attack on Iran. The rate is now at its highest level in seven months. Mortgage rates track the 10-year US Treasury yield, which surged as investors reacted to the war-driven spike in oil prices. With gasoline averaging over $4 a gallon for the first time since 2022, markets are weighing whether inflation will reaccelerate. That prospect has led traders to expect the Federal Reserve will hold rates steady—or possibly hike—delaying any relief for borrowers. Fed Chair Jerome Powell acknowledged the uncertainty, saying the central bank does not yet know the economic fallout from the energy shock. Meanwhile, the mortgage-rate shock is already having an effect: purchase applications fell 3% last week, and refinances dropped 17%. Zillow economist Kara Ng said the spring housing market could stall if the conflict drags on. If it resolves quickly, buyers might return. If not, many could push decisions into next season.