If you’re shopping for a home this summer, brace yourself: mortgage rates aren’t done climbing yet. NerdWallet’s latest forecast suggests June could bring another uptick in borrowing costs, continuing a frustrating trend that’s kept rates stubbornly above 6.75% since mid-April.
The culprit? A perfect storm of economic factors that’s pushing long-term interest rates higher across the board. And while everyone’s waiting for relief, the reality is rates might stay elevated longer than anyone wants to admit.
Why rates keep climbing
Here’s what’s keeping mortgage professionals up at night: the 30-year fixed-rate mortgage has been stuck above 6.75% since April, and there’s little sign of meaningful relief coming soon. Joseph Brusuelas, chief economist at RSM US, points to fundamental shifts in the global economy that suggest this isn’t just a temporary blip.
“Long-term interest rates are rising as populist economics takes hold and globalization fades,” Brusuelas explained in a recent analysis. “The widening gap between 30-year and 10-year Treasury bond yields signals expectations of faster economic growth, higher inflation, and a Federal Reserve that’ll keep policy rates elevated.”
Translation? Don’t expect mortgage rates to suddenly drop back to the 5% range anytime soon, based on NerdWallet’s projections.
Forecasts keep missing the mark
Remember when Fannie Mae and the Mortgage Bankers Association predicted rates would average 6.5% to 6.7% from April through June? With rates averaging 6.8% through May, those projections look overly optimistic. The only way they’d prove accurate is if rates took a dramatic dive in June – and that’s looking increasingly unlikely.
Looking further out, both organizations predict gradual declines through 2026, with rates potentially settling around 6% by early next year. But given their recent track record, homebuyers might want to plan for rates staying higher longer.
The Fed’s playing it safe
At the Federal Reserve’s May meeting, Chair Jerome Powell used the word “uncertainty” eight times – and that sums up where policymakers stand. The Fed has adopted a holding pattern with trade policy impacts still unfolding and inflation concerns lingering.
“Right now, the appropriate thing to do is to wait and see how things evolve,” Powell said during a May 7, 2025, press conference. Markets may be betting the Fed will leave rates unchanged at their June 17-18 meeting, offering no immediate relief for mortgage borrowers.
Housing markets react differently coast to coast
Sustained high rates are creating wildly different scenarios across the country. Nationally, home prices rose just 4% year-over-year through the first quarter of 2025, down from 6.8% growth the previous year, according to Nasdaq. But that modest figure masks dramatic regional variations.
Newark, New Jersey, topped the charts with 11.6% price growth, while Detroit and Providence, Rhode Island, also saw double-digit gains. Meanwhile, Lakeland-Winter Haven, Florida, experienced a jaw-dropping 9% price decline. Overall, 11 of the 100 largest markets saw prices fall – seven in Florida, two in Texas, and one each in Louisiana and California, based on Zillow analysis.
The S&P CoreLogic Case-Shiller Index confirmed this “broad cooling trend” that started in the second half of 2024 and continued into this spring’s buying season. High mortgage rates have simply priced too many buyers out of the market, leading to longer listing times and more price reductions from desperate sellers.
What buyers should do now
If you’re determined to buy this summer, here’s your reality check: Affordability isn’t improving anytime soon. But there’s a silver lining – more sellers are cutting asking prices as homes sit unsold, creating potential negotiating opportunities for buyers who can handle today’s monthly payments.
Florida and Texas markets may offer the most potential for deals, thanks to abundant new construction competing with existing homes. But buyers everywhere need to get creative. Consider adjustable-rate mortgages if you believe rates will eventually fall, or focus on homes that have lingered on the market where sellers might be more motivated.
The hard truth? Waiting for significantly lower rates could mean sitting on the sidelines well into 2026. For many buyers, the question becomes whether the potential savings from future rate drops outweigh the continued price appreciation in markets that remain competitive despite higher borrowing costs.
Navigating the Road Ahead
May’s mortgage rate average of 6.82% marked another incremental increase from April’s 6.73%, and June looks poised to continue that upward drift, according to NerdWallet. While rates have ping-ponged week to week, the overall trajectory remains frustratingly consistent: up, not down.
The combination of persistent inflation concerns, evolving trade policies, and fundamental shifts in the global economy suggests mortgage rates may remain elevated through summer and possibly beyond. Buyers hoping for a return to the sub-6% rates of recent years need to adjust their expectations – and their budgets – accordingly.
For those who can’t wait, the key is finding markets and properties where high rates have dampened demand enough to create genuine opportunities. Don’t count on your mortgage payment getting any friendlier in the months ahead.
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