Key Takeaways
- Mortgage applications in the U.S. saw a significant 5.0% week-over-week decrease for the week ending December 19, a steeper decline than the previous week's 3.8%.
- The average 30-year fixed mortgage rate held at 6.31%, a slight dip from 6.38% in the prior week, yet failed to stimulate demand.
- Both refinancing and purchase applications experienced declines, indicating a continued slowdown in housing market activity as the year concludes.
U.S. mortgage applications fell by 5.0% on a seasonally adjusted basis for the week ending December 19, according to the Mortgage Bankers Association's (MBA) Weekly Mortgage Applications Survey. This marks the second consecutive week of declines and the third in the last four, signaling a persistent cooling in the housing market as 2025 draws to a close. The unadjusted decline was 6% from the previous week.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances decreased slightly to 6.31% from 6.38% the prior week. Despite this marginal drop in rates, it was insufficient to spur increased activity among potential borrowers.
Refinancing applications saw a 6% week-over-week fall, though they remain significantly higher, up 110% compared to the same week last year. This suggests that while some homeowners are still looking to refinance, the current rate environment is not enticing enough for a broader surge in activity. Purchase applications also softened, declining 7% on an unadjusted basis week-over-week, though they are still running 13% above last year's pace.
The continued decline in mortgage applications reflects a typical seasonal slowdown towards the end of the year, compounded by persistent elevated interest rates and ongoing economic uncertainties. Mike Fratantoni, MBA's SVP and Chief Economist, noted that purchase application volume typically drops off quickly at year-end, shifting the mix towards refinancing, which reached 59% of applications last week, the highest since September. This trend highlights the challenges facing the housing market as it heads into the new year.
Ed Liston is a senior contributing editor at TheStockMarketWatch.com. An active market watcher and investor, Ed guides an independent team of experienced analysts and writes for multiple stock trader publications.