Current Trends in Mortgage Applications and Housing Market Data
The recent mortgage rate fluctuations have resulted in unexpected trends within the housing market. Despite a rise in interest rates, the decline in purchase applications over the past week was only 5%, less than anticipated. Year-over-year, the growth rate for purchase applications has also improved, rising from 10% to 13%, likely due to the low figures from the previous year.
Weekly Purchase Application Insights
The latest weekly report reveals a notable increase in new home sales, with purchase applications experiencing a month-to-month growth of 14% and a year-over-year increase of 5.5%:
- 2025: 391,488 pending applications
- 2024: 384,614 pending applications
- 2023: 335,017 pending applications
Mortgage Rates and Economic Trends
In my 2025 predictions, I forecasted mortgage rates to remain between 5.75% and 7.25%, with the 10-year treasury yield fluctuating between 3.80% and 4.70%. Recent developments suggest a stabilization of the 10-year yield around 4.35%, which corresponded with a decrease in mortgage rates. This positive trend reflects a healthier bond market as opposed to the tumultuous conditions seen in the previous year.
Mortgage Spreads and Their Impact
Following the Silicon Valley banking crisis in 2023, mortgage spreads increased significantly. Although there was an improvement throughout 2024, recent volatility has again widened these spreads. If they continue along this unfavorable trajectory, we could see mortgage rates soar toward 8%, complicating the home buying process further. Ideally, spreads should be between 1.60% and 1.80% to stabilize the market.
Housing Inventory Trends
An encouraging development in the housing market is the continuous growth of inventory levels. Recently, inventory rose from 702,434 to 719,400 homes:
- April 2024 inventory: 719,400
- April 2023 inventory: 542,651
- All-time low inventory (2022): 240,497
For perspective, active listings during similar weeks in 2015 stood at 1,060,699.
Increase in New Listings
There has been a positive shift in new listing trends, with projections suggesting that we could see approximately 80,000 homes listed weekly during peak seasons this year. Last week’s figures were:
- 2025: 77,004 new listings
- 2024: 68,409 new listings
- 2023: 59,269 new listings
Price Adjustments in the Market
Approximately one-third of homes in the market typically experience price reductions annually. As inventory increases despite higher mortgage rates, homeowners are adjusting prices accordingly. For the remainder of 2025, I anticipate a modest home price increase of about 1.77%, though this may still indicate negative real price growth considering current inventory levels and elevated rates:
- 2025: 35.5% homes with price cuts
- 2024: 32% homes with price cuts
- 2023: 30% homes with price cuts
Looking Ahead
This week promises notable discussions involving several Federal Reserve presidents that could attract media focus, particularly regarding monetary policy changes under the potential influence of political narratives surrounding current leadership. Upcoming reports on new and existing home sales are expected, with earlier indicators suggesting a potential decline in existing home sales month-over-month.
In conclusion, while challenges persist in the housing market due to fluctuating mortgage rates and inventory issues, recent data suggests a steady improvement that may lead to a more balanced and accessible market. Stay connected for further updates and analyses on these trends.
