Mortgage rates have hovered around the same range for roughly two months, giving current borrowers nor potential homebuyers little incentive to get into the market. Total mortgage application volume was essentially flat last week, up just 0.2% from the prior 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 increased to 6.40% from 6.37%, with points decreasing to 0.60 from 0.62, including the origination fee, for loans with a 20% down payment. That was the highest since early October. Last year, during the same week, the average rate was 46 basis points higher.
Despite the slight rate increase, applications for a mortgage to purchase a home rose 8% for the week and were 20% higher than the same week a year ago. That was driven by buyers looking for cheaper loans. The government purchase index, which includes FHA, VA, and USDA applications, increased 9% for the week and had its strongest week since 2023.
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