The “For Sale” sign stands at a home in Miami, Florida on April 16, 2025.
Marco Bello | Reuters
Higher interest rates and concerns about where the broader economy is heading have led to a sharp decline in mortgage demand. Last week, total mortgage applications fell 12.7% compared to last week, according to the Mortgage Bankers Association’s Seasonally Adjusted Index.
The average contract rate for a 30-year fixed-rate mortgage with conforming loan balances rose from 6.81% to 6.90%, below $806,500, and rose from 0.66 to 0.66, including the origin fee for a 20% down payment loan. This is the best rate in two months, but is 34 basis points lower than the same week a year ago. Prices have risen by almost 30 basis points in just two weeks.
An increase in rates is strongly ordered to refinance demand. These applications fell 20% in a week, but 43% higher than the same week a year ago. The refinance share of mortgage activities fell from 41.3% last week to 37.3% of total applications.
Mortgage applications to buy mortgages fell 7% in a week, up 6% year-on-year. Home buyers are fighting for more than just higher interest rates. Home prices continue to be raised, and recent stock market plunges have some that don’t want to sell their shares to pay a down payment.
“As in the past week, economic uncertainty and rate volatility have impacted future home buyers,” said Joel Kang, vice president and assistant chief economist at the MBA.
Mortgage News Daily found interest rates were high on Monday and stalled on Tuesday.
“The headline on Trump’s comments about the Fed chair rattles Powell to Powell and sends a higher rate,” wrote Matthew Graham, chief operating officer of Mortgage News on Tuesday. “Now 24 hours later, the absence of additional escalations has given way to milder market movements and generally fixed interest rates.”
