Mortgage Momentum: Applications Surge as Rates Drop to 11-Month Low

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U.S. mortgage applications jumped 9.2 percent last week, marking “the strongest week of borrower demand since 2022,” according to the Mortgage Bankers Association (MBA). This surge came as the 30-year fixed mortgage rate dipped to 6.49 percent, its lowest level in nearly a year.

“Mortgage rates declined for the second consecutive week as Treasury yields moved lower on data indicating that the labor market is weakening,” said Joel Kan, MBA’s vice president and deputy chief economist.

This shift is driving a wave of renewed interest from both buyers and those looking to refinance.

Purchase and Refinance Activity On the Rise

Both home-purchase and refinance applications saw major movement. “Home-purchase applications jumped to their highest level since July… which is 20 percent ahead of 2024,” the report noted.

Refinance activity also boomed. “Refinance applications accounted for almost 49 percent of all applications last week.” The Refinance Index increased by 12 percent from the week before and was 34 percent higher than the same week a year ago. This is especially noteworthy given the rising average loan size for refinance applications.

What’s Happening With Different Loan Types?

Here’s a quick breakdown of what changed last week across various mortgage types:

• Conforming Loans (≤ $806,500): Rates dropped, and points decreased from 0.59 to 0.56.
• Jumbo Loans (> $806,500): Rates fell to 6.44 percent, although points rose to 0.48.
• Adjustable-Rate Mortgages (5/1 ARMs): Rates declined to 5.77 percent, and their share of applications rose to 9.2 percent.
• FHA Loans: Rate down to 6.27 percent, with points falling to 0.68.
• VA Loans: Applications increased from 13.8 to 15.3 percent.
• USDA Loans: Slight increase in applications from 0.5 to 0.6 percent.
• 15-Year Fixed Mortgages: Dropped below 6 percent, now at 5.7 percent with significantly reduced points.

For buyers or investors considering multiple financing options, this is a rare environment where nearly every category saw positive rate movement.

Home Prices Are Still High, but That’s Not Stopping Buyers

Despite “near record-high home prices,” momentum hasn’t slowed. The median U.S. home price hit $422,400 in August, marking the 25th consecutive month of year-over-year price increases. Orange County, with its high demand and limited inventory, mirrors this trend—and could offer even more upside if rates continue to decline.

Bottomline

Rates are the lowest they’ve been in nearly a year. Demand is rising. Refinancing is surging. If you’ve been waiting on the sidelines—whether to buy, sell, or upgrade—now’s the time to move. Orange County remains one of the most competitive and rewarding real estate markets in the country, and Whitestone Real Estate is here to guide you every step of the way. Let’s turn this market shift into your next big opportunity.

Reference: Prenon, M. (2025, September 10). US mortgage applications rise nearly 10 percent to 3-year high. The Epoch Times.