Weekly mortgage demand drops as rates remain stuck in a narrow range
Aerial view shows a residential neighborhood in Pembroke Pines, Florida, on June 4, 2026.
Joe Raedle | Getty Images
Mortgage rates have been in a narrow range for more than a month, and that range is on the relatively high side. As a result, there is not much movement in mortgage demand.
Total mortgage application volume fell 2.2% last week compared to the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Additional arrangements have been made for the Independence Day holiday.
The average contract interest rate for 30-year fixed-rate mortgages with loan balances of $832,750 or less increased to 6.58% from 6.57% last week; Points including the origination fee for loans with 20% down payment decreased from 0.65 to 0.64.
Applications to refinance a mortgage fell 4 percent this week and rose 8 percent from the same week a year ago. At this time last year, the 30-year fixed rate was just 19 basis points higher. Most lenders say the cost of refinancing isn’t worth it unless the borrower shaves at least 75 basis points off their interest rate.
Mortgage applications to buy a home fell 1 percent this week and rose 5 percent from the same week a year ago. As inventory increases and homes last longer, buyers are starting to get more leverage in the market. After this situation has turned into an advantage for the seller for several years, more agencies are now saying that the market is balanced.
While overall mortgage demand is declining, products offering lower down payments are gaining momentum.
“Government purchase volume increased modestly, led by a 5 percent increase in VA purchase applications, and traditional purchase activity decreased. Refinance application volume fell 4 percent, as homeowners still saw little incentive to take action with higher rates,” MBA Senior Vice President and chief economist Mike Fratantoni said in a statement.
Mortgage rates rose slightly starting this week, according to a separate survey from Mortgage News Daily. The Iran war hit the headlines again on Tuesday, with reports suggesting the US may once again halt Iran’s oil exports.
“Rising oil prices mean higher inflation. Higher inflation leads to higher rates, all else equal,” wrote Matthew Graham, chief operating officer of Mortgage News Daily.
