A ‘For Sale’ sign is posted in front of a home for sale on March 5, 2025 in Pasadena, California.
Mario Tama | Getty Images
Mortgage rates have barely budged in the last month. That, and a broader concern among consumers about the state of the economy, has also kept mortgage demand muted.
Total mortgage application volume dropped 1.6% last week compared with the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances, $806,500 or less, decreased to 6.70% from 6.71%, with points increasing to 0.62 from 0.60, including the origination fee, for loans with a 20% down payment.
Applications to refinance a home loan dropped 6% for the week and were 57% higher than the same week one year ago. The annual comparison is so large because the total volume is so low. Mortgage rates were 21 basis points higher the same week one year ago. Given how low rates were during the first few years of the Covid pandemic, which sparked a massive refinance boom, there are now precious few borrowers who can benefit from a refinance at the current rates.
Applications for a mortgage to purchase a home rose 2% for the week and were 9% higher than the same week a year ago. Demand from buyers was at its highest level since the end of January, driven by a 3% increase in conventional purchases. Demand for government loans, favored by lower-income borrowers, was down 2%.
“Overall purchase activity has shown year-over-year growth for more than two months as the inventory of existing homes for sale continues to increase, a positive development for the housing market despite the uncertain near-term outlook,” said Joel Kan, vice president and deputy chief economist at the MBA.
Mortgage rates started this week slightly lower but are still moving in a very narrow range as uncertainty over tariffs keeps the markets guessing.
