Home mortgage demand surges as rates drop to 6.35%
Mortgage interest rates are falling drastically, according to recent data from Freddie Mac’s Primary Mortgage Market Survey (PMMS). Week-over-week results show that the average 30-year fixed-rate mortgage fell by 15 basis points, the most this year. After reaching the anticipated 6.50% average rate last week, the PMMS reports rates at 6.35% as of September 11, 2025.
With an expected cut by the Fed coming up next week, it appears that home prices are beginning to factor in lower rates in mortgages. Rates are inching closer to what they were a year ago, making it a good time to buy. As a result, more applications to buy or refinance a home are being seen. Purchase applications reached a year-over-year high compared to the last four years, with applications at their highest since July.
Whether the rate will continue to decrease as sharply as exhibited remains yet to be seen. For now, however, the average rate being lower will help take pressure off builders relying on incentives to sell new inventory. The current rates will move the market in a positive direction even if they do not drop much more.
