A “Coming Soon” sign outside a home for sale in Hercules, California, USA, on Wednesday, June 17, 2026.
David Paul Morris | Bloomberg | Getty Images
Mortgage rates continued to rise last week, but home buyers flooded back into the market, perhaps taking advantage of reduced competition and some price reductions. That helped drive total mortgage demand up 1.9% last week compared to the previous 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 of $832,750 or less increased from 6.65% to 6.69%, with points for loans with a 20% down payment decreasing from 0.67 to 0.62, including the origination fee. That was the highest rate since last August.
As a result, refinance demand, which is highly sensitive to weekly interest rate movements, fell 2% this week and was just 7% higher than the same week a year ago. At this time last year, the average 30-year fixed loan was only 15 basis points higher.
Mortgage applications to purchase a home rose 6% this week and were 0.2% higher year-over-year – essentially flat. Potential buyers are starting to get a bit of a break as the market settles into the historically weaker summer months. In CNBC’s Housing Market Survey, real estate agents report that sellers appear more willing to lower prices.
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“Growing home inventory in many markets is driving buying activity,” said Mike Fratantoni, senior vice president and chief economist at MBA. “Incoming data showed that inflation fell in June, but with oil prices rising again, this improvement appears unlikely to continue into July data and mortgage rates are likely to remain higher as a result.”
Mortgage rates rose even further earlier this week, reaching their most recent peak in mid-May, according to a separate survey by Mortgage News Daily. New escalations in the war with Iran overshadowed last week’s weaker than expected inflation reports.
“For those who want to keep the analysis simple, fuel prices explain the move quite well. In fact, August gasoline futures also just reached their May 19 highs this week – which lines up perfectly with the back-and-forth in interest rates,” wrote Matthew Graham, chief operating officer at Mortgage News Daily.
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