Mortgage Activity Spikes as Rates Briefly Dip
A dip in interest rates in early July sparked a noticeable jump in mortgage activity, offering a temporary boost to an otherwise quiet market. Total mortgage application volume rose 9.4%, according to the Mortgage Bankers Association, with seasonal adjustments made for the July Fourth holiday.
Rates for 30-year fixed mortgages with conforming loan balances ($806,500 or less) edged down to 6.77% from 6.79%, while points held steady at 0.62 for borrowers putting 20% down. That drop brought rates to their lowest level in three months.
Refinance applications climbed 9% and were 56% higher than they were a year ago, though demand in that category has generally remained low, held back by months of elevated rates.
Purchase applications also saw a 9% increase, landing 25% higher than the same time last year.
The uptick in buyer activity appears to be fueled by growing inventory and slower home-price appreciation. At the same time, the average loan size on a purchase application dropped to $432,600, the lowest seen since January 2025.
Still, mortgage demand isn’t translating directly to more home sales—at least not yet. Consumer confidence is inconsistent, and cancellation rates for both new and existing homes have stayed high. Pending home sales, which track signed contracts, haven’t followed the same upward trend.
Meanwhile, mortgage rates started rising again around the July Fourth holiday and have continued to tick up into mid-July, according to a separate survey from Mortgage News Daily. That shift may just be a natural correction after a steady downward trend throughout June, which brought rates to their lowest levels in months. Even with the recent increase, rates remain lower than they were in late April.
If you’re feeling unsure about how to navigate this fluctuating market, I’m here to help you move forward with confidence. Reach out any time—I’d be glad to answer questions, strategize, or simply talk through your options!
