Rising rates push first-time buyers out of the spring market
Mortgage application volume declined 4.4% last week as the 30-year fixed rate climbed to its highest point in a month, according to the Mortgage Bankers Association's weekly survey for the week ending May 1, 2026.
The average contract interest rate for 30-year fixed-rate mortgages with conforming loan balances ($832,750 or less) rose to 6.45% from 6.37%, with points increasing to 0.66 from 0.61.
Middle East tensions keep rates elevated
"The ongoing conflict in the Middle East continues to push rates higher. Mortgage rates last week increased to their highest level in a month, with the 30-year fixed rate rising to 6.45%," said Joel Kan, MBA's vice president and deputy chief economist.
"As expected, elevated rates and shrinking refinance incentives continued to weigh on activity, with refinance applications declining again from the prior week – most notably for conventional and VA loans. The refinance share of applications was the lowest since August 2025."
The refinance index fell 5% week-over-week. While demand remained 29% above year-ago levels, that annual comparison has been narrowing as rate differentials shrink – the 30-year fixed was just 39 basis points higher at this point in 2025.
US mortgage rates climb again, reinforcing a mid 6 percent environment driven by bond market moves.
— Mortgage Professional America Magazine (@MPAMagazineUS) April 30, 2026
Sam Khater of Freddie Mac, Amir Nurani of Left Coast Leaders, and Tushar Garg of Flyhomes highlight strong but sensitive demand.https://t.co/j2wol383Yz
Record purchase loan size signals affordability strain
Purchase applications dropped 4% for the week, though they remained 5% above the same week last year.
The more telling figure was the average purchase loan size, which rose to $467,300 – the highest recorded in the MBA's survey history dating to 1990.
"This increase could indicate that potential first-time buyers, and buyers looking for homes at lower price points, might be the most hesitant to move forward given the economic uncertainty and higher rates," said Kan.
The spring market has been uneven. After a sluggish start when rates spiked in March, conditions appeared to stabilize as supply improved and rates eased – but last week's data suggests that momentum may be stalling again.
Broader rate picture
Jumbo loan rates edged up to 6.47% from 6.45%, while FHA 30-year rates rose to 6.12% from 6.09%.
The 15-year fixed climbed to 5.83% from 5.77%. The FHA share of applications increased slightly to 17.7%, while the VA share slipped to 14.9%.
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