Mortgage applications for the week ending Jan. 24 fell 2% from the previous week, on a seasonally adjusted basis, according to data from the Mortgage Bankers Association (MBA).

The week’s results, which include an adjustment for the Martin Luther King holiday, decreased 9% compared to the previous week on an unadjusted basis. Refinancing decreased 7% for the week but was 5% higher than the same week one year ago.

Home purchases fell by 0.4% from one week earlier. The unadjusted purchase level was down 4% from the previous week and 7% below the same week one year ago.

Refinancing continued its recent decline as interest rates have stayed elevated, falling to a 37.1% share of all mortgage applications, down from 40.4% the week before. The Federal Housing Administration (FHA) share of applications increased slightly to 16.7% from 16.5% the previous week. The Veterans Administration share of applications fell to 13.2% from 14.6% a week earlier.

The average interest rate on a 30-year fixed-rate mortgage remained unchanged at 7.02%. FHA’s interest rate on mortgage loans decreased to 6.72% from 6.74% the week before. The average 15-year mortgage rate fell to 6.37%, from 6.45%.

Joel Kan, MBA’s vice president and deputy chief economist, said application activity was slightly weaker during the week, primarily because of the 7% decline in refinancing across both conventional and government loans.

“Purchase activity decreased slightly, but applications for FHA purchase loans were a bright spot, increasing by 2%, Kan said. “New and existing-home sales ended 2024 on a strong note, and if mortgage rates continue to stabilize and for-sale inventory loosens, we expect a gradual pick up in purchase activity in the coming months.”