Why mortgage purchase apps are on a 22-week growth streak

Purchase apps

My joke about purchase apps data is that the last time we saw levels this low was in the 1990s, when No Doubt was the hottest new band and “Gangsta’s Paradise” was the No. 1 song in America. However, after nine straight weeks of double-digit year-over-year growth, we’ve now returned to levels comparable to those in 2014, when “Happy” by Pharrell Williams was dominating the charts.

Does this mean that existing home sales are returning to the low levels of 2014, which were around 4.75 million? Not exactly. Let me explain. 

Purchase apps serve as a trend survey and have historically aligned closely with existing home sales. However, for this data to show real growth, it needs to consistently increase by double digits for several months to generate significant momentum. Additionally, this growth must be confirmed by our weekly pending sales data, which I discussed in the most recent episode of the HousingWire Daily podcast.

Considering 2024 as a historic low benchmark for purchase apps, mortgage rates have declined and generally been lower this year. Moreover, the number of new listings has also increased compared to the previous year. Since 70% to 80% home sellers are also homebuyers, they will be filling out purchase applications. Given these two factors, we’ve had room to run up higher year over year.

The remarkable thing is that this growth is occurring despite mortgage rates not trending below 6.64% — a level we’ve needed in the past to achieve better housing data.

Last week, we saw flat week-to-week growth in purchase applications, with a 0.1% increase from the previous week. The unadjusted numbers were up 10% week to week, but we don’t count that data. The year-over-year growth stood at 16%.

Here is the weekly purchase application data for 2025 so far:

• 11 positive readings
• 9 negative readings
• 5 flat prints
• 22 straight weeks of positive year-over-year data
• 9 straight weeks of double-digit, year-over-year growth 

10-year yield and mortgage rates

In my 2025 forecast, I anticipated the following ranges:

• Mortgage rates between 5.75% and 7.25%
• The 10-year yield fluctuating between 3.80% and 4.70%

Last week was jobs week, and two out of the four reports were satisfactory. The job openings and jobless claims data were good. However, the ADP report showed a decline of 33,000 jobs. While the Jobs Friday report (released on Thursday) beat estimates, this was primarily due to the addition of government jobs, which have a seasonal quirk in this particular report. If it weren’t for the government positions, we would have only seen 74,000 jobs created, which I wrote about here.

In any case, when the 10-year yield was trading at 4.21% earlier in the week, I tweeted on X that unless the labor data gets worse, a lot of that sentiment has already been priced in. After the jobs report beat estimates on Friday, the 10-year yield went straight back toward the key 4.35% level on the short holiday trading week. Mortgage rates got as low as 6.67% to end the week at 6.75%.

Mortgage spreads

Mortgage spreads have been elevated since 2022 but have improved since their peak in 2023. We experienced some drama with the spreads in April as the markets dealt with the tariffs, but things have improved as the market calmed down. If the trade war intensifies in the future and stocks decline again, we will assess whether the spreads worsen. However, for now, the spreads have performed better as stocks have returned to all-time highs.

If the spreads were as bad as they were at the peak of 2023, mortgage rates would currently be 0.71% higher. Conversely, if the spreads returned to their normal range, mortgage rates would be 0.79% to 0.59% lower than today’s level. Historically, mortgage spreads have typically ranged between 1.60% and 1.80%.

New listings

Weekly data can be volatile around the holidays, particularly around July 4th, which fell on a Friday this year. Our new listing data has taken a significant dip, even falling below last year’s figures. I’m not too concerned about this trend; it will bounce back soon. However, we are entering our seasonal decline period for the remainder of the year.

Here’s the new listings data for last week over the past several years:

• 2025: 69,700
• 2024: 71,159

Weekly pending home sales

You can also see the effect of the holiday in our weekly pending sales data, as it also experienced a significant decline.

Weekly pending sales for last week over the last two years:

• 2025: 66,967
• 2024: 67,986

Total pending home sales

Our total pending home sales data is less susceptible to weekly fluctuations and continues to show year-over-year growth, a trend that persisted for many weeks before the holiday week.

Weekly pending sales for the last week over the past several years:

• 2025: 396,652
• 2024: 381,054

Housing inventory

Our weekly housing inventory data experienced good week-to-week growth; however, this data line is also impacted to some degree by the holidays. This remains the best housing story of 2025, as active inventory has returned to at least the low levels we saw in 2019.

• Weekly inventory change (June 27-July 4): Inventory rose from 831,110 to 853,180
• The same week last year (June 28-July 5): Inventory rose from 645,713 to 652,518

Price cut percentage

Our weekly price cut percentage data is similar to our inventory data as well during this holiday week.

Before the holiday week, the housing data showed some resilience, with stabilization in the data lines. However, the due to the July 4th Holiday, you can see how these two weeks can impact fresh weekly data.

The week ahead: Tariffs back in play again?

Last week, Treasury Secretary Scott Bessent announced that the U.S. plans to impose 10% tariffs on approximately 100 countries, including those that have been negotiating in good faith, in the upcoming week. It looks like the new deadline for deals is August 1st, 2025
This development could have a significant impact on the markets and the Fed’s mindset. Additionally, the usual inflation report that follows the jobs week will be delayed a week. 

This week, we will see some bond auctions, speeches from Federal Reserve presidents, and data on the used car price index. As always, the weekly jobless claims data will be an important labor market indicator ahead of the next Fed meeting at the end of the week. Recently, the weekly data has shown improvement in initial claims, while the continued jobless claims data appears to be softer.

In any case, if we receive another round of trade war headlines, that should be enough, along with talks about the tax bill passing, to keep the markets occupied during the summer weeks.