Oil-driven inflation lifts mortgage rates, reshaping spring homebuying

Oil-driven inflation fears from the Iran conflict are lifting mortgage rates into the mid-6% range, with the 30-year fixed around 6.35% recently, up from about 5.99% two weeks earlier; economists say higher oil costs fuel inflation, which pushes rates higher, though affordability has improved versus last year thanks to more inventory and slower home-price gains. Buyers can hedge risk with rate locks or options like float-downs, recognizing trade-offs if rates fall or rise. If oil stays elevated, rates could edge toward 6.5%; the 10-year Treasury yield near 4.25% supports this near-term path. The National Association of Realtors’ affordability index shows a February median-priced home at about $401,800 requiring roughly $93,700 income to qualify at current rates, lower than a year ago.