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Mortgage Applications Slip Again as Markets Price In September Fed Cut

Pre-pricing of a likely quarter-point Fed move leaves mid-6% mortgages insufficient to overcome affordability constraints.

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FILE - A "For Sale" sign is displayed outside a home on Friday, July 11, 2025, in Portland, Ore. (AP Photo/Jenny Kane, File)
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Overview

  • The average 30-year fixed rate dipped to roughly 6.64%, the lowest since April, with trackers showing recent ranges between about 6.56% and 6.72%.
  • MBA data for the week ending Aug. 29 show total applications down 1.2%, as purchase activity fell 3% and refinances rose 1%, lifting refis to 46.9% of volume.
  • FHA and VA refinances drove the increase as FHA rates run about 30 basis points below conventional, boosting FHA to 19.9% and VA to 13.8% of applications; ARMs reached 8.8%.
  • CME FedWatch places roughly 90%–95% odds on a 25-basis-point cut on Sept. 17, a move many lenders have already priced in, suggesting only modest near-term mortgage-rate changes.
  • Upcoming releases including the August jobs report and September CPI could sway rate expectations, while affordability gains remain gradual and continue to cap buyer demand.