Mortgage rates in Utah crossed 7% on Friday, Sept. 11, for the first time in more than a year. The jump pushes monthly payments further out of reach for buyers across the Lehi area.

The 30-year fixed-rate mortgage index hit 7.08% by midday Friday, according to the Deseret News, citing Mortgage News Daily. U.S. News posted an average of 7.104% based on Zillow data.

The spike lands hard in a metro where the median home price sits at $572,450 and the median household income is $101,014, according to a Ziffy.ai analysis reported by the Lehi Free Press in July. To make that home affordable on that income, rates would need to fall to 2.3%. That rate doesn't exist.

Rate increases since the U.S. and Israel launched the ongoing war against Iran in late February have added an estimated $244 to the monthly payment on a $433,000 home, according to CNBC. Before the conflict, rates had dipped below 6% for the first time since 2022. A bond-market selloff tied to a U.S. Treasury Department buyback program and rising oil prices drove the latest surge, according to U.S. News.

75% of the market is locked up

Steve Waldrip, the governor's senior adviser for housing strategy, said at a recent Kem C. Gardner Policy Institute event that roughly 75% of Utah's housing market is locked up. Homeowners who bought or refinanced at rates less than half of what they are now don't want to give up their mortgages. More than 61% of Utah mortgage holders carry an interest rate below 4%, according to a Gardner Institute outlook cited by the Lehi Free Press.

"I don't think that we'll see a decrease in interest rates anytime soon," Waldrip said. "I don't think anybody is anticipating returning to the 3% market."

A Gardner Institute housing report released Sept. 9 found that Utah's median sale price across all housing types reached $520,000 in the first quarter of 2026. The estimated average monthly mortgage payment of $3,669 puts homeownership beyond what 91% of Utah renters can afford, according to the report.

Dejan Eskic, senior research fellow at the Gardner Institute and co-author of the report, warned against waiting for rates to drop. He said there have been only "maybe two times in our housing history that it was worth waiting," in the 1980s when rates hit double digits and after the 2008 financial crisis.

A possible Fed rate hike looms

The Deseret News reported a Federal Reserve rate hike the week of Sept. 14 is increasingly likely, which could push borrowing costs higher still.

Jeremy Holmgren, senior vice president of Zions Bank Mortgage, told the Deseret News on Sept. 4, when rates stood at 6.71%, that a 7% rate isn't "dramatically different" than one at 6.75%. He urged buyers to stay in the market, citing growing inventory in Utah that could give them leverage with sellers.

Statewide, 74% of Utahns are priced out of purchasing a median-priced home. Utah's population is projected to surpass 4 million by 2035, requiring roughly 280,000 additional housing units, according to the Gardner Institute.