Mortgage rates have been increasing steadily throughout 2025, with experts predicting they may soon exceed 7%. Mark Zandi, chief economist at Moody's Analytics, told CBS News that rates are "effectively there" and could easily surpass the 7% threshold. According to Freddie Mac, the average rate for a 30-year fixed-rate mortgage rose to 6.71%, the highest in 13 months and up from below 6% in late February. These rates had last reached the 7% mark in January 2025. The rise in mortgage rates is linked to instability in the bond market, which has been affected by concerns over inflation. Rising energy prices and increasing U.S. government debt have contributed to a global sell-off in bonds, raising borrowing costs for mortgages, auto loans, and credit cards. Mortgage rates closely follow the 10-year Treasury yield, which has climbed from 4.08% to 4.77% over the past six months. Investors are seeking higher returns to offset the perceived risks of holding long-term bonds. With inflation still above the Federal Reserve's 2% annual target, traders expect the central bank to raise its benchmark interest rate later this month, according to the CME FedWatch tool. A key indicator will be the Labor Department's Consumer Price Index data for August. Zandi noted that the bond market is "very fragile — not just in the U.S. but globally," and rates could continue to rise, potentially pushing mortgage rates above 7%. Kate Wood, a lending expert at NerdWallet, said some borrowers are already encountering mortgage rates at or above 7%, with about half of the quotes she reviewed from lenders already surpassing that level. Jake Krimmel, a senior economist at Realtor.com, believes mortgage costs are likely to remain high for some time. While he is uncertain if rates will reach 7%, he expects them to continue rising rather than falling. Higher mortgage rates can increase the cost of buying a home, but they may also create opportunities. Wood pointed out that reduced competition in the housing market could lead to lower home prices, as higher rates may deter some buyers from entering the market.