The news was even better in the Mortgage Bankers Association’s (MBA) July report, also released on Thursday. It showed that homebuyer affordability improved in the month.
According to the MBA Purchase Applications Payment Index (PAPI) report, the median payment applied for in July decreased to $2,127, down from $2,172 in June.
Edward Seiler is the MBA associate vice president of housing economics and executive director of the Research Institute for Housing America. He said while rates will likely remain elevated for the rest of the year, other factors could continue to bring buyers to the market.
“Affordability conditions have now improved for two consecutive months, the result of lower mortgage rates and continued, strong income growth,” Seiler said. “MBA is forecasting that mortgage rates will remain in the 6.5 percent to 7 percent range for the rest of 2025. While still elevated, continued income growth and softening home-price gains should boost prospective buyers’ purchasing power in the months ahead.”
Cuts priced in
According to the Redfin report, the weekly average mortgage rate is sitting at 6.58%, the lowest it has been in 10 months.