Global Bond Sell-Off Deepens, Pushing Mortgage Rates Higher

A worldwide sell-off in government bonds is accelerating, raising borrowing costs and putting new pressure on housing markets. The trend began as investors demanded higher returns on long-term government debt. That pushed bond prices down and yields up. Higher bond yields quickly feed into mortgage rates. In several major economies, home loan costs have climbed to multi-year highs. The shift is squeezing homebuyers. Monthly payments are rising, and affordability is worsening in markets that were already tight. Existing homeowners are also affected. Those refinancing or moving face noticeably higher interest costs than they locked in earlier. Analysts point to several drivers. Sticky inflation, heavy government borrowing, and uncertainty over central bank policy are all playing a role. Central banks have signaled they will not rush to cut rates. That stance has reinforced the bond sell-off rather than calming it. The housing impact varies by country. Markets with high household debt and variable-rate mortgages are feeling the sharpest pain. Economists warn the pressure could persist. If yields stay elevated, housing activity may slow further and weigh on broader growth. For now, investors are watching two signals closely: inflation data and central bank guidance. Both will shape whether the sell-off eases or intensifies.