Purchase activity jumped week over week and outpaced year-ago levels, even as the 30-year fixed rate hit 6.46%
Buyers who retreated to the sidelines during a volatile spring are re-entering the market and they are doing so even as mortgage rates climb to their highest point in more than a month.
Total mortgage application volume rose 1.7% in the week ending May 8, 2026, according to the Mortgage Bankers Association's seasonally adjusted index, with purchase demand leading the way.
Applications for home purchase mortgages advanced 4% over the prior week on a seasonally adjusted basis and were running 7% ahead of the same period a year ago.
The improvement cut across all loan types, suggesting the uptick was not driven by any single segment of the market.
"Purchase applications were higher over the week and 7 percent ahead of last year's pace, with all loan types showing increases in purchase activity, as potential homebuyers shrugged off the current economic and mortgage rate uncertainties and returned to the market," said Joel Kan, MBA’s vice president and deputy chief economist.
The rebound is notable because it follows a soft patch at the outset of the spring selling season, when buyer demand stalled against a backdrop of economic uncertainty and the onset of the US–Iran conflict.
Read more: April home sales inch forward as mortgage rates and Iran conflict weigh on market
Rate environment: steady pressure at the margins
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances — those at or below $832,750 — edged up one basis point to 6.46%, the highest reading in five weeks.
While not a dramatic jump, it marks a continuation of the elevated-rate environment that has redefined the market over the past two years.
Jumbo loan rates moved in parallel, rising one basis point to 6.48%, while Federal Housing Administration-backed mortgages climbed four basis points to 6.16%.
The 15-year fixed rate held steady at 5.83%, and the 5/1 adjustable-rate mortgage jumped 10 basis points to 5.70%.
The ARM share of total applications held flat at 8.8%, suggesting borrowers are not significantly rotating into adjustable products to escape higher fixed rates, at least not yet.
Mat Ishbia of United Wholesale Mortgage and Mike Fawaz of Origna8 say brokers who focus on consumer needs, strong relationships, and controllable factors will be best positioned as market conditions evolve.https://t.co/B6S5I4iPva
— Mortgage Professional America Magazine (@MPAMagazineUS) May 12, 2026
Refinance share falls to lowest since mid-2025
Refinance applications declined 1% from the prior week, though they remain 28% higher than the same week one year ago.
Still, the refinance share of total applications dropped to 40.8% from 42%, the lowest proportion since July 2025.
The VA refinance share was among the categories drawing down, leaving the overall VA share of total applications unchanged at 14.9%.
FHA applications ticked up to 17.9% of the total, from 17.7%, while USDA remained flat at 0.5%.
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