Rough winter weather hits homebuyers, tanking mortgage demand
People walk on Lancaster St. during a winter storm on Monday, January 26, 2026 in Albany, NY. They dig up their cars parked along the street.
Lori Van Buren | Albany Times Union | Getty Images
The harsh winter storm that hit much of the country recently also damaged the mortgage market in the following week. Potential buyers stayed home and mortgage rates did not move enough to stimulate refinancing demand.
Total mortgage application volume fell 8.9% last week compared to the previous week, according to the Mortgage Bankers Association’s seasonally adjusted index. Last week’s results included a correction for the Martin Luther King Jr. holiday.
The average contract interest rate for 30-year fixed-rate mortgages with loan balances of $832,750 or less decreased from 6.24% to 6.21%; Points including the origination fee for loans with 20% down payment increased from 0.55 to 0.56.
Despite the drop, applications to refinance a mortgage fell 5% this week but were still 117% higher than the same week a year ago, when rates were above 7%. The share of refinancing of mortgage activity in total applications increased from 56.2% in the previous week to 57.1%.
Mortgage applications to buy a home fell 14 percent this week and were up just 4 percent from last year.
“Winter Storm Fern likely had an impact because much of the country was blanketed in snow, hindering home-buying activity,” said Joel Kan, MBA vice president and deputy chief economist. “The annual increase in purchase applications was the weakest since April 2025.”
Mortgage rates rose starting this week, according to a separate index from Mortgage News Daily. They’re currently at a two-week high, but that doesn’t mean much since the range is so small. Rates rose after a stronger-than-expected report on the manufacturing sector.
Correction: This story has been updated to correct the time reference for the recent winter storm.
