The latest figures come as households face higher costs across several parts of the economy. Consumer inflation remained elevated in August, while energy prices increased amid renewed fighting in the Middle East. Those pressures are affecting purchasing decisions and complicating the environment for prospective homebuyers already dealing with high mortgage payments and home prices.
Mortgage Rates Reach Their Highest Level in More Than 14 Months
The average rate on a 30-year fixed mortgage increased to 6.76%, up from 6.71% a week earlier, according to Freddie Mac. A year earlier, the comparable rate stood at 6.35%. The latest reading is the highest average rate recorded since June 26, 2025, when the 30-year rate was 6.77%. The increase marks the third consecutive weekly rise in borrowing costs for buyers seeking long-term home loans.
Rates on 15-year fixed mortgages also moved higher. According to Freddie Mac, the average rate reached 6.09%, compared with 6.04% the previous week. One year ago, the average 15-year rate was 5.5%.
Higher mortgage rates increase monthly borrowing costs and reduce the amount some buyers can afford to spend on a property. According to Fortune, these higher costs can add hundreds of dollars to monthly payments, while some prospective buyers may choose to delay a purchase as financing becomes more expensive.
The rise in borrowing costs comes alongside continued inflation pressure. The Labor Department reported that the consumer price index increased 3.4% in August from a year earlier, unchanged from July’s annual rate. On a monthly basis, prices climbed 0.4% from July to August, compared with a 0.1% increase in the previous month. Wholesale inflation also accelerated. The producer price index rose 5.4% in August from a year earlier, up from 4.8% in July, according to the Labor Department.
Existing Home Sales Fall to Their Slowest Pace in More Than a Year
Sales of previously occupied U.S. homes fell 2% in August from July to a seasonally adjusted annual rate of 3.98 million units, according to the National Association of Realtors. The decline marked the third straight monthly drop and brought the sales pace to its lowest level in more than a year. Sales were also 1.2% lower than in August 2025. The 3.98 million annualized pace came in just below the 4 million rate economists had expected, according to FactSet.
The weakening in sales occurred while buyers continued to face both higher mortgage rates and elevated home prices. U.S. home sales have remained largely stagnant again this year as financing costs limit purchasing power.
Broader economic conditions have added to those pressures. Diesel prices reached a national average of $6.05 a gallon, up from $5.85 a week earlier and $3.70 a year ago, according to AAA. U.S. oil prices also moved above $100 a barrel during the week before easing, while Brent crude fell 3% to $104.42 on Friday after approaching $110 overnight.
