Mortgage application activity rose sharply in January, driven primarily by a surge in refinancing activity as mortgage rates declined to a new low. The Mortgage Bankers Association’s (MBA) Market Composite Index, a measure of total mortgage application volume, increased 12.9% from December on a seasonally adjusted basis and was 61.3% higher than a year earlier.
The average contract interest rate for 30-year fixed mortgages dropped 13 basis points (bps) to 6.2% following the announcement of $200 billion in mortgage-backed securities (MBS) buybacks by the GSEs. Compared with January 2025, the 30-year fixed mortgage rate was 81 bps lower. The decline in rates supported month-over-month gains in both purchase and refinance activity. Purchase applications increased 2.9%, while refinance applications surged 19.8%. Relative to January 2025, purchase activity increased 16.2%, while refinance applications jumped 143.8%.
By loan type, applications for fixed-rate mortgages (FRMs) and adjustable-rate mortgages (ARMs) increased 12.9% and 7.9% month-over-month, respectively. On a year-over-year basis, FRM applications were up 57.8%, while ARM applications more than doubled, rising 113.1%. As of January 2026, ARMs accounted for an average of 7.1% of total applications on a non-seasonally adjusted basis, down 0.4 percentage points from December but 1.7 percentage points higher than a year earlier.
For loan sizes, the average loan amount across the total market increased by 1.1% to $402,000. Average purchase loan sizes increased 2.5% to $435,400, while the refinance loan size increased modestly by 0.2% to $378,000. In contrast, the average ARM loan size continued to decline, falling 4.4% to $925,600.
This article was originally published by a eyeonhousing.org . Read the Original article here. .
Take a deep dive into the previous year’s performance of your firm, prioritizing four main areas.
Finances. Profitability and cash flow are, of course, essential for any business, so make sure you cover this aspect thoroughly during your annual review. “I keep records of each project, the time spent and revenue earned, as well as the types of projects that work best for me,” Auzins says. “We review fees and costs, and work out if changes are needed.”
“We analyze profitability, evaluate individual project performance and examine trends in financial data,” says Alex Strikovs, managing director of design-build firm Home Republic. “This helps us understand what drives profitability and where to focus our efforts.”
Reader recommends doing an audit of all your outgoings. “It’s important to keep an eye on the functionality of key expensive tools, such as the computer and software, and to plan upgrades ahead of time,” he says. “I also review the ongoing relevance of regular outgoings, such as memberships and publicity payments, to ensure they’re still required and are delivering.
“Income is obviously also key and with [at least] nine months of income data in hand, as well as client numbers and types of projects, I can reflect on the balance and areas of income generation of the business,” he says. “From these, I can make informed decisions on my preferred work and my pricing model for the coming year.”
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