MW With mortgage rates back above 6%, spring homebuying season kicks off with a tricky calculation for both buyers and sellers
Andrew Keshner
A recent dip below the 6% level had buyers and sellers feeling hopeful about a thaw, but the Iran conflict has put uncertainty back on the table
The average 30-year mortgage rate's brief dip below 6% had energized some prospective buyers and sellers, but the economic uncertainty of the Mideast conflict is adding complications to this pivotal season.
Mortgage rates ticked higher last week, continuing their march above 6% and potentially complicating the calculus for buyers and sellers at the beginning of a spring season that had been showing green shoots.
The average 30-year fixed-rate mortgage was at 6.11% as of March 12, according to Freddie Mac (FMCC).
That's up from 6% a week ago and 5.98% at the end of February, which marked the first time rates had dipped below 6% since 2022 - giving a glimmer of hope to aspiring buyers who've been waiting on the sidelines for rates to come down.
"Despite the modest uptick, buyers are responding to rates in this range," said Sam Khater, Freddie Mac's chief economist. He noted a rise in existing-home sales last month and an increase in purchase applications. Both were "a welcome sign as buyers enter spring homebuying season with rates down more than half a percentage point compared to the same time last year."
Thursday's rate data come as lenders try to understand the economic implications of the Iran conflict, which are producing a surge in oil prices to the $100-a-barrel level and beyond, with retail gasoline prices also sharply higher since hostilities were launched.
See: Trump is tapping America's Strategic Petroleum Reserve to fight rising gasoline prices. How much oil is left in it now?
Nevertheless, mortgage rates are still lower than they were at this point last year, when they averaged 6.65%.
So buyers now face a tricky choice: jump in now or wait in the hope that rates retreat below 6% and the economic picture clears up.
'Waiting for conditions to improve is a gamble. Our expectation is that rates remain in this range through the end of the year.'Kara Ng, Zillow
It's important to take the long view, said Kara Ng, a senior economist at Zillow (Z).
"For many households, this is a friendlier market than last spring, with more inventory and less intense competition," she said. "If the home fits your budget and your life, this is a window worth considering. Waiting for conditions to improve is a gamble. Our expectation is that rates remain in this range through the end of the year."
There have been early signs of a thaw in a housing market that's been iced by high borrowing costs, high home prices and low inventory. The median price of sold homes was $405,300 at the end of 2025, down from $419,300 the year prior, according to federal government data.
Existing-home sales in February surpassed forecasts. Just over one-third of all home purchasers last month, 34%, were first-time buyers, according to the National Association of Realtors. That was up from 31% in January and 31% a year ago.
The median age of a first-time buyer reached 40 last year, a record high.
That echoes a hopeful tone elsewhere. More people believe homeownership is affordable, or will be in the future, according to a Northwestern Mutual survey released this week. Generation Z members and millennials who didn't own homes grew notably more optimistic from 2025 to 2026, according to the data.
Just over half - 54% - of Gen Z survey participants and 47% of millennials said they could afford to own a home now or in the future, up from 42% and 34%, respectively, last year.
Younger people have been largely shut out of the housing market in recent years. The median age of a first-time buyer reached 40 last year, a record high.
Stronger buying demand is music to the ears of sellers who have been struggling to sell their homes. Almost 45,000 homes were relisted for sale in January after owners pulled properties off the market last year, according to Redfin. That's the highest amount of relistings in records going back a decade.
Now comes the military conflict in Iran, and a sharp focus on global oil supply.
Buyers and sellers may have been prepared for the down payments and borrowing costs involved in the purchase of a home. The question is whether they are now prepared to go forward with house-shopping plans in spite of new volatility and uncertainty in the economy.
The S&P 500 is down 2.1% in the past month. The average cost of a gallon of gas is up 65 cents in the same time, according to AAA data.
Bond yields have also risen, which matters for home-loan seekers. Mortgage rates tend to follow the yield on the 10-year Treasury note BX:TMUBMUSD10Y. The 10-year note's yield has moved higher since Feb. 28, when U.S. and Israeli strikes were launched against Iran, which retaliated against targets around the region.
The 10-year note's yield was 4.255% as of late Thursday morning.
Researchers say people tend to become especially attuned to the state of the economy when they are about to make a major financial decision such as a home purchase.
War in Iran may be spooking some would-be buyers, according to a new Redfin survey. But the impact of the conflict may be smaller than other big-picture events, Redfin researchers noted.
One-quarter of people say that, in light of the Mideast conflict, they are either delaying or cancelling major purchase plans - which could include buying a car or a home. At the same time, though, 14% say they have accelerated purchase plans.
If sellers really want to know what's on buyers' minds, a stronger signal may be coming from the job market. If people feel good about their job prospects, they'll feel confident about covering mortgage payments on a new home.
The U.S. labor market has been in low-hire, low-fire mode for a while, and the economy unexpectedly lost 92,000 jobs last month.
"We have seen job-security concerns emerging in consumer-sentiment surveys, and labor-market anxiety may be impacting both buyers and sellers," said Ruben Gonzalez, chief economist at Keller Williams.
But, as with real estate itself, much depends on location.
"Regionally, there is a lot of variation in inventory conditions right now," he said. "Sun Belt states are experiencing markets with the most advantaged buyers, while markets in the Northeast and Midwest frequently remain advantaged toward sellers."
-Andrew Keshner
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(END) Dow Jones Newswires
March 12, 2026 12:34 ET (16:34 GMT)
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