Inflationary pressure hits the US property market! US mortgage interest rates hit a new high in nearly a year, and the number of home purchase loan applications hit a five-month low

The Zhitong Finance App learned that last week, US mortgage interest rates climbed to the highest level since August 2025, while the number of home purchase loan applications fell to the lowest level since February this year.

According to the latest weekly data released by the American Mortgage Bankers Association (MBA) on Wednesday, the average contract interest rate for 30-year fixed-rate mortgages rose 7 basis points to 6.65% in the week ending July 10. Meanwhile, the Association's home purchase mortgage application index fell 7.3%.

The rise in loan interest rates and the decline in application volumes reflect on the side how inflation is impacting the US property market — investors generally expect that in order to cope with the price pressure caused by the war in Iran, the Federal Reserve will continue to raise the benchmark interest rate in the coming months.

Federal Reserve Chairman Kevin Walsh specifically pointed out during his testimony in Congress on Tuesday that against the backdrop of the steady overall performance of the US economy, the real estate market has become a clear shortcoming. He said that part of the reason why 30-year fixed-rate mortgages remain high is “inflation continues to be higher than the target level of the Federal Reserve.”

Walsh then added, “I've always believed in the American dream, and owning my first home and applying for a mortgage is an important step in making that dream come true. We will do everything we can to support this goal.”