Mortgage rates backed off their recent 2026 high this week after concerns over an escalation of the Iran War temporarily subsided, but the numbers don't necessarily mean an end to ongoing volatility, economists warned.
The 30-year fixed average decreased 9 basis points to 6.37%, according to Freddie Mac's Primary Mortgage Market Survey of April 9. The rate fell from the previous survey period's 6.46%, its high mark so far for 2026, and marks the first drop since the U.S. declared war on Iran in late February. One year ago, the average stood at 6.62%.
The 15-year average also edged back but by a smaller margin to 5.74% from 5.77% week over week. In the same seven-day period of 2025, the 15-year fixed finished at 5.82%.
"The decrease in rates represents a positive development for prospective homebuyers and could spark a more favorable spring homebuying season than last year," said Freddie Mac Chief Economist Sam Khater in a press release.
The Iran War and the housing market
Other experts showed less optimism, as the Iran War's impact continues to ripple across the economy, including the housing market. The initial onset of the conflict led to the rapid acceleration of mortgage rates after the 30-year average dipped below 6% in late February.
Markets may be breathing a sigh of relief upon the announcement of a two-week ceasefire after President Trump's social media posts that included threats to annihilate Iran, but many housing researchers expressed little confidence it meant the start of a consistent improving affordability trend.
"While the ceasefire news following President Trump's recent remarks could provide a brief reprieve for mortgage rates, it is premature to call this a pivot point for the spring housing season. We expect continued turbulence as the market remains skeptical of a permanent resolution for the Strait of Hormuz," said Bright MLS Chief Economist Lisa Sturtevant in a statement.
"With energy and shipping costs keeping inflation figures 'sticky,' a substantial drop in rates appears unlikely for the foreseeable future," she added.
Still, even as the recent rate shock ate into affordability, a segment of aspiring homeowners appear to have become accustomed to dealing with uncertainty, according to Kara Ng, senior economist at Zillow Home Loans.
Zillow's March numbers showed the month was one of the busiest for newly pending home sales since late 2022 but was a likely reflection of early-year trends. "Near-term demand may be sustained by a wave of buyers operating on the finite timeline of rate locks secured when rates were near 6%," Ng said.
How Treasury yields responded
Movements of 10-year Treasury yields, which influence mortgage rates, offered a glimpse into some of the volatility markets are experiencing. After closing at 4.31% on April 2, the 10-year opened at 4.29% Thursday and sat at 4.27% as of midday. During the seven days in between, though, the 10-year hit as high as 4.38% as questions swirled over the direction of the war.
The effect of the current geopolitical climate is proving challenging for home lenders this month, after application volumes decreased for four straight weeks, the Mortgage Bankers Association said.
"Ongoing economic uncertainty and higher mortgage rates continue to weigh on demand. Both purchase and refinance activity remain subdued, with purchase applications falling on an annual basis for the first time since January 2025," MBA President and CEO Bob Broeksmit noted in a weekly statement.
Although the past week provided some relief, lenders shouldn't necessarily expect the current situation to hold, Sturtevant remarked.
"For the spring season to truly break out, instead of just policy announcements, we will need more policy stability," she said.
