Mortgage rates cool down in response to AI stock sell-off, lower Treasury yields

Mortgage rates have been on the upswing for most of the second half of 2026, but consumers and housing professionals got a respite this week. At HousingWire‘s Mortgage Rates Center, rates for 30-year conforming loans averaged 7.52% on Tuesday — down 11 basis points from one week ago. Rates for 30-year loans through the Federal Housing Administration (FHA) averaged 7.18%, down 19 bps in the past week and 41 bps lower than two weeks ago. Rates for 30-year jumbo loans rose 1 bps to 7.76%. The higher-for-longer rate environment is being felt in the form of lower consumer demand, which is expected to continue through next year. At last week’s Mortgage Bankers Association (MBA) Annual Convention & Expo in Chicago, the trade group’s economists announced an expected pullback in single-family origination volumes, with totals declining from an estimated $2.1 trillion in 2026 to $1.99 trillion in 2027. Fannie Mae and Bank of America released even lower projected totals for 2027 of $1.8 trillion and $1.72 trillion, respectively. “Mortgage applications declined further last week as the 30-year fixed mortgage rate surpassed 7.5%, continuing to strain affordability and dampen demand,” Bob Bro...