Spring Home Buying Faces Rates That Won't Fall

The spring home buying season looks weak, and forecasters can't agree on where rates head. That makes planning impossible.

The 30-year mortgage rate was 6.44% on March 25 - near the highest level since mid-2025. Everyone expected rates to fall all year. Instead they're flat or rising. That flips the whole plan for spring buyers.

Forecasters Disagree Wildly

The Mortgage Bankers group says rates stay above 6% all year. That's grim - it means no help comes for buyers.

Fannie Mae is hopeful: rates drop to 5.7% by year-end. That's much better. But that forecast came before the recent jump in rates from the Iran fight.

Iran War Changed Everything

Neither group built serious war risk into their plans. They guessed oil might hit $90-100. Instead it's racing toward $115, and price forecasts keep jumping. Both forecasts are old news.

If fighting stops and oil falls, Fannie Mae's 5.7% forecast makes sense. If war gets worse and oil tops $120, the Bankers' bleak "6% all year" becomes real. It all depends on Iran.

What to Watch

Watch the 10-year Treasury yield - it drives mortgage rates most. If the Strait opens and oil falls, yields drop and mortgage rates follow.

If war escalates and oil spikes, yields jump and rates could hit 6.6-6.7%. Spring buying closes by June - just weeks for things to improve.

If they don't, April and May sales will be weak, which pushes home prices down later in summer.