Home Buyers Reemerge As Mortgage Rates Dip

A brief dip in mortgage rates encouraged potential homebuyers to return to the market, sending home purchase loan applications to their highest level since early 2024.

Mortgage rates, like other loans, are influenced by the bond market, which has experienced significant turbulence.

But the reprieve may be short-lived, as bond market volatility has pushed rates as high as 7%, Shaina Mishkin and Janet H. Cho reported for Barron’s Daily.

According to the Mortgage Bankers Association (MBA), mortgage applications rose a seasonally adjusted 9% last week. Buyers appeared more enticed by lower borrowing costs than deterred by broader economic uncertainty.

Rates had fallen to 6.6%, but have since risen again to 7% for a 30-year fixed mortgage before dipping slightly to 6.95%, according to Mortgage News Daily.

Mortgage rates, like other loans, are influenced by the bond market, which has experienced significant turbulence. The 10-year Treasury yield recently rose 0.151 percentage points—its largest three-day gain since June 2022, according to Dow Jones Market Data.

The real estate market has struggled in recent years, with higher borrowing costs sidelining many buyers. However, some—especially those with limited stock market exposure—may now see an opportunity.

Compass agent Dana Bull said many of her clients had been preparing to buy or sell for months.

Still, uncertainty looms. If tariffs do trigger the recession some economists expect, buyers could once again retreat—despite lower rates—especially if job losses rise. “All of this is a very significant negative for housing,” said Mark Zandi, chief economist at Moody’s Analytics.