Trump avoids calling Iran conflict a ‘war’
President Trump explained his reasoning behind refusing to call the Iran conflict a “war,” citing the need to get congressional approval.
- Mortgage rates have risen sharply following a joint U.S. and Israeli attack against Iran in late February.
- As of March 25, the average 30-year fixed mortgage rate reached 6.48%, up from 5.99% before the conflict.
- Rising rates have led to a 5% drop in mortgage applications and are increasing monthly payments for homebuyers.
Mortgage rates have recently seen a sharp uptick since the United States and Israel issued a joint attack against Iran at the end of February.
Much like gas prices have done over the last month, mortgage rates are on the rise in the United States due to the war with Iran. Before the year started, 2026 was expected to be a year where the housing market would somewhat return to normal, with more homes sold than in 2025, but that may not be the case now. CNBC reported that mortgage applications dropped 5% between the week of March 16 and the week of March 23.
It is likely that this trend among home buyers will continue if the cost of living continues to rise and the war with Iran persists.
Here is a look at how much mortgage rates have grown since the war started.
What is the current mortgage rate?
As of March 25, mortgage rates have reached 6.48%, a steep increase from the end of February, when the rate was 5.99% for a 30-year fixed mortgage. Since Feb. 28, when the United States and Israel entered a war with Iran, Mortgage News Daily reports that the national mortgage rate has grown and is hovering around 6.5%.
Between Feb. 27 and March 2, the mortgage rate jumped from 5.99% to 6.12%. The steepest increase over the last month was from March 10 to 13, when the rate jumped from 6.09% to 6.41%.
Why are mortgage rates rising?
Mortgage rates have been volatile this week due to mixed signals from President Trump and Iran about war negotiations. The bond market, which affects mortgage rates, has reacted quickly to ongoing military activity and political rhetoric, potentially leading to long-term impacts.
Increased interest rates have limited the anticipated improvement in housing affordability. Before the war, mortgage rates were declining, home price increases were tapering off, and the number of homes available for sale was increasing. As interest rates rose last week, applications for a mortgage to buy a home dropped 5% from the previous week, according to the Mortgage Bankers Association. But it’s not just mortgage rates.
Even before the war began, buyers were canceling contracts at the highest rate since 2017, according to Redfin. Roughly 1 in 7 homes, or 13.7%, that went under contract in February were canceled, up from 12.8% a year earlier.
How will this affect Tennessee’s housing market?
In February, the median sales price for a single-family home in Tennessee was $396,800. When comparing mortgage rates just before the war began to those now, there has been a sharp increase in the monthly mortgage payment for the same home.
Assuming someone purchasing a house went the traditional route with a 20% down payment, the median household in Tennessee, priced at $396,800, would pay $112.72 more per month in March than in February.
In February, the monthly mortgage payment would be $2,279.17, but using the March 25 rate, a homeowner would owe $2,391.89. This amounts to an interest difference of $39,437.46 over the 30-year loan term.
Sales numbers for March will be released in mid-April. Until then, there is currently no clear indicator of how the increase in mortgage rates is affecting Tennessee specifically.
USA TODAY contributed to this report.
Jordan Green covers trending news for The Commercial Appeal and Tennessee. She can be reached at [email protected].
