Mortgage rates spike after Iran strikes

What a difference a weekend makes

Last week, mortgage rates fell to the lowest weekly average in more than three years. By Monday, they had spiked by 13 basis points, and the yield on the 10-year Treasury moved back above the all-important 4% threshold. 

Why?

In today’s Blueprint, we break down what happened and explain how you can use this to spark urgency in your clients. Complacency is going to cost them.

Whether it’s a curse or not, we live in interesting times, friends.

- David

Mortgage rates jump sharply higher after Iran strikes

Mortgage rates moved sharply higher Monday, with the 30-year fixed jumping 13 basis points to 6.12% as the yield on the U.S. 10-year Treasury climbed back above 4%. According to CNBC, the escalating conflict with Iran pushed oil prices higher, raising inflation concerns and pressuring bond yields.

Here are the key facts to know:

• Rate reversal: The 30-year fixed mortgage climbed to 6.12%, up from 5.99% on Feb. 23, which had marked the lowest level in more than three years. Even with the jump, rates are still 62 basis points lower than this time last year (6.74%).

• Treasury movement: The 10-year Treasury yield moved back above 4%, a barometer mortgage rates tend to follow closely.

• What markets initially thought: The escalation with Iran pushed oil prices higher, which raised fresh inflation concerns. That led investors to demand higher yields on bonds — and mortgage rates followed.

• But here’s the nuance: Mortgage News Daily suggests this may have been more about technical bond-market positioning at the start of a new month than a fundamental inflation shift.

• Why it matters: The 4% level on the 10-year is important. If yields stay above it, mortgage rates could have a harder time drifting back into the 5% range. If yields fall back below 4%, there’s a clearer path lower.

• What’s next: Friday’s jobs report is the big catalyst. A softer labor report could relieve pressure on yields. A strong one could reinforce higher-rate expectations.

• Fed watch: The Fed meets March 17–18. For now, markets expect policymakers to hold rates steady at 3.5%–3.75%

My take

Oil spikes make for dramatic headlines, but the real issue is whether they lead to lasting inflation. Historically, oil and the 10-year Treasury don’t always move in sync — when oil surged to $120 in 2022, the 10-year was around 3%, and when oil dropped in 2023, yields kept rising. In other words, oil alone doesn’t set the direction for bond markets. The labor market is also an equally important factor. With the Fed meeting in mid-March, Friday’s jobs report could be the key driver: a softer report would ease pressure on yields, while a strong one could keep rates higher for longer. Agents, use the volatility we’re seeing to spark some urgency in your clients. When rates dip – even just a little – they need to be ready to move, because their window of opportunity can close fast.

Markets with the biggest surge in luxury pending sales

Luxury pending home sales rose 30% year over year in West Palm Beach, FL, in January, the largest increase among the 50 most populous U.S. metropolitan areas.

The surge stands in sharp contrast to national trends. Across the U.S., luxury pending sales fell 3.6%, and non-luxury pending sales declined 1.8% year over year. In West Palm Beach, however, luxury pending sales grew nearly six times faster than the metro’s non-luxury segment, rising by 5.2%. 

Here are the top five metros with the biggest year-over-year gains in luxury pending sales:

1. West Palm Beach, FL: +30.0%

2. Tampa, FL: +24.7%

3. Portland, OR: +20.0%

4. Pittsburgh, PA: +17.3%

5. Nashville, TN: +13.5%

My take

Luxury housing isn’t moving in one national direction right now — it’s breaking into local stories. Nationally, luxury pending sales fell 3.6%, but West Palm Beach jumped 30%, growing nearly six times faster than its own non-luxury segment. That’s not just superior performance — that’s a different market dynamic entirely. In places like West Palm and Tampa, the strength seems tied to ongoing wealth migration and steady high-end demand, while gains in markets like Portland and Pittsburgh may be more of a rebound story than a long-term shift. The bottom line: when it comes to luxury, national averages are masking powerful metro-level differences. Luxury performance is becoming highly market-specific.

The most expensive zip codes in the U.S.

As of January 2026, a home must list at roughly $1.2 million to break into the top 10% nationwide. That’s the entry point to the national luxury market, according to realtor.com’s latest update. 

Here’s what each luxury tier now requires:

• Luxury: Top 10% (90th percentile) – $1,193,085

• High-End Luxury: Top 5% (95th percentile) – $1,912,790

• Ultraluxury: Top 1% (99th Percentile) – $5,635,028

But even within the top 1%, the country’s most exclusive ZIP codes operate on another level.  

To rank among the 10 most expensive ZIP codes in America, the median listing price now starts at $5.5 million, down from $5.9 million last summer.

Here are the top 10 most expensive zip codes by median list price:

1. Newport Coast, Newport Beach, CA – $12.5M

2. Fisher Island, Miami Beach, FL – $11.9M

3. Beverly Hills, CA – $10.4M

4. Bridgehampton, NY – $8.8M

5. Bel Air, Los Angeles, CA – $7.9M

6. Water Mill, NY – $6.9M

7. Montecito, Santa Barbara, CA – $6.4M

8. Rancho Santa Fe, CA – $5.9M

9. Newport Beach, CA – $5.9M

10. Paradise Valley, AZ – $5.5M

My take

The ultra-luxury market is proving two things at once: it’s resilient and selective. Prices at the very top remain staggering — you still need $5.5 million just to enter the 10 most expensive ZIP codes — but buyer demand isn’t moving with the same intensity it did last year. That suggests we’re no longer in a pure surge phase. Instead, only the truly exceptional properties command full pricing power. Wealth remains concentrated, inventory is limited, and buyers are sophisticated. The ultra-elite market isn’t weakening; the money is still there, but the frenzy is fading.

Schematics

The news that just missed the cut

• Manhattan luxury sales hit $1B in February

• Use these strategies to produce explosive growth in your business as an agent

• This is how long the typical homeowner hangs onto their homes now 

• Home sales rate plummets below Great Recession level in California 

• Zuck’s $170 Miami mansion is one of the priciest ever to close in the U.S.

Foundation Plans

Advice from David to win the day

Except for markets in the Northeast, buyers definitely have the advantage right now in most markets across the country. They’re in a strong negotiating position. Agents will need to prepare sellers on how to maximize their position in this environment, which includes conversations about price reductions. But how do you broach this touchy subject without losing your seller client’s business in the process? In today’s edition, we share some tips on how to handle price reductions with your sellers. 

1. Start with a strategic price – If you price a home well from the start, price reductions may be a non-issue. Remember: if you overprice a home, it’s going to sit on the market, rack up reductions, and end up netting a lower price than if you had priced it competitively from the start and sold in a matter of days.

2. Shop it off-market to test the price – Before you list on the MLS, get some eyes on the listing through off-market showings and open houses. Get some brokers through the doors, start building interest, and get feedback on the list price before you go live so you know whether adjustments are needed.

3. If your seller won’t budge on price, set clear expectations – Let them know if you list at that price point, they need to be prepared to make adjustments along the way. Say, “If this property hasn’t sold by X date, we’re going to meet and talk about a new price.” That way, they know to expect the price-adjustment conversation and are ready to compromise. 

For more advice on how to talk to clients about price reductions, watch this from Former Keller Williams CEO, Chris Heller. The framing he uses is great.

Just in Case

Keep the latest industry data in your back pocket with today’s mortgage rates:

“Your time is limited, so don’t waste it living someone else’s life.” — Steve Jobs

Each day is a gift – a chance to live the life you want. Ruthlessly focus on your goals. Don’t let your past or the fear of being judged distract or paralyze you. Choose to live with an integrity that you can be proud of.

See you on Friday, friends!

- David