The October 2025 ICE Mortgage Monitor Report has been made public by ICE Mortgage Technology, a division of Intercontinental Exchange, Inc. Thanks to falling mortgage rates, housing affordability has increased to its highest level in two and a half years, according to ICE data.
ICE recaps high-level mortgage performance statistics as reported in the most recent First Look, tracking changes in delinquency, foreclosure, and prepayment trends through the end of April, including an examination of recent foreclosure activity.
Next, they reviewed interest rate dynamics and the implied outlook for 30-year mortgage rates. This month ICE examined the purchase market and provided an update on retention. They continued to monitor home prices using the latest data from the ICE Home Price Index, keeping a close eye on for-sale inventories. Finally, experts provided an update on home equity and equity utilization through the end of Q1.
“The recent pullback in rates has created a tailwind for both homebuyers and existing borrowers,” said Andy Walden, Head of Mortgage and Housing Market Research at ICE.
According to ICE, housing affordability is at a 2.5-year high, which is starting to increase the overall U.S. demand for home purchases and provide homeowners additional options to reduce their monthly payments with a rate-and-term refinance loan.
ICE Reports Best Level of Affordability Since Early 2023
The monthly principal and interest (P&I) payment on an average-priced home has decreased to $2,148, or 30% of the median family income in the U.S., due to 30-year mortgage rates that averaged 6.26% in mid-September. P&I expenses have improved from their peak of 35% in late 2023 and have decreased from 32% earlier this summer, but they are still more than five percentage points above their long-run average.
Coastal areas are still severely stretched, even if about a dozen of the country’s 100 biggest housing markets—mostly in the Midwest—are close to long-term average affordability levels. The market discrepancy is exemplified by the fact that, in Los Angeles, buying an average-priced home requires an estimated 62% of the median salary.
Further, following eight months of slowdown, annual home price rise increased to +1.2% in September due to improved affordability and declining inventory. Due to sellers in formerly oversupplied markets delaying sales to prevent price reductions, listings nationwide are still 17–19% below 2017–2019 norms.
Due to lower supplies and better affordability, the Northeast and Midwest experience the most annual price increases. Just 20% of markets witnessed price declines in September, compared to 55% two months prior, while 80% of markets saw price hikes, the most percentage in nine months. However, with 25% more than 2% off and 10% more than 5% below their highs, almost half of the major markets are still below recent peaks.
Home Prices & Inventory Tighten as Borrower Profiles Reflect Improved Financial Stability
A change toward a more credit-qualified borrower mix is evident as the average credit score for buy locks has risen beyond 736, the highest level seen in the six-year history of ICE’s origination dataset. As affordability continues to improve, debt-to-income (DTI) ratios for purchase rate locks have decreased to an estimated 38.5%, the lowest level in 2.5 years. The average credit score for rate-and-term refinances has increased to 722, a nine-month high, while the average DTI has decreased to 34.1%, a 3.5-year low.
Tim Bowler, President of ICE Mortgage Technology, stated that lenders and servicers must be prepared to move swiftly as affordability increases and homeowners are able to refinance.
Whether borrowers are looking to buy, refinance, or access their equity, the integrated MSP servicing and Encompass loan origination platforms, along with strong data and analytics, allow consumers to find and connect with them at the appropriate time. He noted that clients may provide a contemporary experience and seize possibilities when market conditions change by utilizing ICE’s technologies.
A more thorough examination of August mortgage payment performance, mortgage origination patterns, and housing market developments utilizing September ICE Home Price Index (HPI) data can be found in the complete October Mortgage Monitor report.
To read the full report, click here.
