Total mortgage application volume fell 1.2% in the week ended Oct. 30, even as the average 30-year fixed rate declined for a third straight week, according to the Mortgage Bankers Association.
The average contract rate on a 30-year fixed mortgage with a conforming loan balance of $832.8K or less eased to 7.30% from 7.37%. Jumbo loans above that threshold slipped to 7.20% from 7.28%, and the FHA-backed 30-year fell to 7.02% from 7.12%. The 15-year fixed moved the other way, rising to 6.76% from 6.70%, while points on the conforming loan dropped to 0.75 from 0.76 for borrowers putting 20% down.
Applications to buy a home fell 2% week over week and ran 19% below the same week a year ago.
Refinance volume rose 0.1%, leaving it 60% lower than a year earlier.
Rates are falling from a very high base
The 30-year rate is still nearly a full percentage point above where it stood 12 months ago, which leaves almost no one with a reason to refinance.
Three weeks of small declines haven't undone September's jump, when the rate hit 7.50% in the week ended Oct. 9, the highest since November 2023.
Mortgage Rates Fell for a Third Straight Week
Average 30-year fixed conforming contract rate, %, weekly through Oct. 30, 2026
Bar chart. Rate (%). Oct 9: Rate (%) 7.50%. Oct 16: Rate (%) 7.41%. Oct 23: Rate (%) 7.37%. Oct 30: Rate (%) 7.30%.
The purchase index has now fallen in eight of the last nine weeks and sits close to the lowest since January 2025.
Refinancing made up 39.8% of all applications last week, up from 38.9% the week before, a shift driven more by shrinking purchase volume than by refinance demand.
Borrowers are reaching for adjustable rates
The adjustable-rate mortgage share climbed to 11.4% of total applications, the highest level since September 2025.
The average rate on a 5/1 adjustable-rate loan fell to 6.29% from 6.41%, roughly a full point cheaper than the 30-year fixed.
Adjustable-rate loans carry lower starting payments and reset later, so the savings come with a future repricing risk.
Government-backed demand moved in both directions. The Federal Housing Administration share slipped to 16.0% from 16.6%, while the Veterans Affairs share edged up to 11.2% from 11.0%. The USDA's share edged up to 0.6% from 0.5%.
Fratantoni tied the recent rate drift to the Federal Reserve's October decision to hold off on additional rate hikes.
The broader housing picture stayed weak through the fall. September brought a record low for contract signings on previously owned homes. Since rates pushed back above 7% in mid-September, an already weak market has deteriorated further. Across every quarter since the start of 2025 except one, residential construction has been a drag on economic growth.
Rates ticked higher at the start of this week after a job openings report came in hotter than expected, a reading that typically pushes borrowing costs up.
For buyers, a 7-basis-point drop trims a few dollars off a monthly payment, while the gap to last year's rates still measures in hundreds.
