Last week, mortgage rates fell slightly after five consecutive weeks of increases, with the average rate for a 30-year fixed mortgage decreasing to 6.77% from 6.81%. This decline contributed to a 3.6% rise in total mortgage application volume, as reported by the Mortgage Bankers Association.
Notably, refinancing applications increased by 5% week-over-week, although they remain 22% lower than the same period last year. The average loan size for refinancing has dropped to its lowest since July 2025, reflecting diminished incentives for homeowners to refinance at current rates. Meanwhile, applications for purchasing homes rose by 3%, but are still 1% lower compared to the previous year.
The housing market is facing challenges, including high home prices and limited inventory, which have contributed to a slower August compared to last year. As mortgage rates have slightly increased again at the start of this week, future movements will likely depend on the upcoming Consumer Price Index report, which is anticipated to influence rates significantly