04:06 PM EST, 02/19/2025 (MT Newswires) -- Weekly mortgage applications fell to their slowest pace since the beginning of the year, the Mortgage Bankers Association said Wednesday, while a Redfin (RDFN) report showed that housing-market dynamics are switching in favor buyers for the first time this decade.

The market composite index, which measures loan application volume, decreased 6.6% for the week ended Feb. 14 on a seasonally adjusted basis, following a gain of 2.3% in the week prior. Without adjustments, the index slid 4% on a weekly basis.

The refinance index dropped 7% from the week before, while the seasonally adjusted purchase index declined 6%.

"Purchase applications were down for the week, as buyers remained on the fence, although loosening inventory may help support activity in the coming months," Joel Kan, the association's deputy chief economist, said.

Mortgage rates decreased on average "as markets brushed off unexpectedly strong inflation data," Kan said. Last week, the Bureau of Labor Statistics reported that US consumer inflation accelerated in January, while producer price growth rose more than Wall Street's expectations.

The average interest rate for 30-year fixed-rate mortgages with conforming loan balances of $766,550 or less decreased to 6.93% from 6.95% the week earlier. For loan balances higher than that amount, the rate increased to 7.03% from 6.96%. For 15-year loans, the rate moved down to 6.31% from 6.35% week over week.

Fixed-rate mortgages with 30-year terms backed by the Federal Housing Administration, which are often used by first-time home buyers and can involve smaller down payments, edged up to 6.7% from 6.69% week over week. The FHA's share of total applications increased to 16.6% from 16%.

Redfin said Wednesday that for-sale supply reached 3.7 months in January, the highest since February 2019. Historically, a buyer's market has been defined as when there's a supply of four to six months, but "old definitions don't fit the reality of today's market," according to Redfin Economics Research Lead Chen Zhao.

"Many buyers don't feel like they are in a buyer's market, with home prices at near-record highs and mortgage rates elevated," he said. "But we are more than halfway through the decade and this is the first time we can say that buyers have as much, if not more, power than sellers."

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