An aerial view of residential homes, many with solar panels, on September 17, 2025 in Fontana, California.
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Mortgage rates continued to rise last week, causing both current homeowners and potential homebuyers, particularly first-time buyers, to withdraw from the market. According to the Mortgage Bankers Association’s seasonally adjusted index, overall mortgage application volume fell 4.4% compared to the previous week.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances of $832,750 or less increased from 6.37% to 6.45%, with points for loans with a 20% down payment increasing from 0.61 to 0.66, including the origination fee.
“The ongoing conflict in the Middle East continues to push interest rates higher. Mortgage rates rose last week to their highest level in a month,” Joel Kan, MBA vice president and deputy chief economist, said in a news release.
Mortgage applications to purchase a home fell 4% this week and were just 5% higher than the same week a year ago. The spring housing market was rocky and started very slowly as interest rates rose sharply in March. It appeared to be rising recently as prices fell and more supply came onto the market, but buyers are once again struggling with affordability.
“The average loan size on a purchase application rose to $467,300, the highest in the history of the 1990 survey. This increase may indicate that potential first-time buyers and buyers seeking lower-priced homes may be the most hesitant to move forward amid economic uncertainty and higher interest rates,” Kan said.
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The number of applications to refinance a home loan fell the most, falling by 5% over the week. Demand was still 29% higher than the same week a year ago, but it is down year-over-year. The 30-year fixed rate was only 39 basis points higher this time last year. The refinancing share of mortgage activity fell to 42% of all applications, the lowest level since August 2025.
Mortgage rates rose even higher earlier this week, according to a separate survey from Mortgage News Daily. The next big move could come on Friday after the release of the government’s monthly jobs report.
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