Live Markets-Borrowing rates rise, but so does mortgage demand as housing supply improves

MBA's mortgage demand data, while relatively current, is still last week's news.

Housing stocks, on the other hand, reflect where investors expect the sector to be six months to a year in the future.

With that in mind, investors' view of the sector is not particularly bullish.

While housing-related indexes—the S&P 1500 Homebuilding Index .SPCOMHOME and the PHLX Housing Sector Index .HGX—handily outperformed the broader market in the first two months of 2026, that advantage evaporated in March when the U.S.-Israeli war on Iran pushed interest rates higher, taking mortgage rates with them.

Since then, the indexes have largely underperformed the broader market.

Year-to-date, the SPCOMHOME is now down 2.6% and the HGX is up 0.6%. For its part, the S&P 500 .SPX is up 9.7% so far this year.

Midway through a week that's been something of a data desert, the Mortgage Bankers Association has a little something to tide us over.

The upshot: financing home loans grew more expensive last week.

But while the refi crowd had little patience for it, would-be homebuyers bit the bullet.

The average 30-year fixed contract rate USMG=ECI increased by 4 basis points to 6.69%, the highest it's been since last August.

Even so, demand for loans to purchase homes USMGPI=ECI grew by a counterintuitive 5.5%. Refi applications USMGR=ECI, on the other hand—which accounted for a 41.2% share of the mortgage pie—dropped by 2.4%.

Combined, home loan demand increased by 1.9% last week.