Episode summary
2027 inflation and mortgage rate outlook
HousingWire Daily
· · 24 min · Hosts: Sarah Wheeler · Guests: Logan Mohtashami
Summary
Logan Mohtashami argues that the 2027 mortgage-rate outlook is being driven less by the latest CPI print and more by the conflict-driven jump in oil and the 10-year Treasury yield. He says the market has already priced in near-term Fed tightening, so the bigger question is whether oil, tariffs, and geopolitics keep pushing yields higher or whether those forces cool before 2027. He repeatedly frames the current setup as a moving target, with mortgage rates reacting to headlines almost day by day.
He says the oil-and-yield relationship has become the strongest correlation he has seen in years, especially over the last six or seven weeks, and that the 10-year yield is now acting on conflict news more than on inflation data alone. He also argues that labor market stabilization has been the first major piece of the inflation story, while AI spending and supply shocks complicate any easy return to lower inflation.
Looking ahead, Logan says the next three and a half months matter more than the distant 2027 forecast, because progress on the conflict and trade tensions could change the rate path materially. He says mortgage rates need easier comps, lower oil, and a calmer bond market to move meaningfully lower, while anything like oil at $125 would be bad for yields and mortgage rates.
Key takeaways
- Logan Mohtashami says the market is now treating oil and conflict headlines as the main driver of the 10-year yield, not the CPI print.
- He says the bond market has already priced in near-term Fed hikes, so mortgage rates will move more with yields than with the Fed announcement itself.
- Mohtashami says the current base for the 10-year yield is 4.46% to 4.50%, with mortgage rates base-lined around 6.50% to 6.75%.
- He argues that if the conflict ends and oil falls, 2027 could look materially different because inflation comps would get easier.
- He says oil at 125 would be bad for the 10-year yield and would likely keep mortgage rates elevated.
Notable quotes
“the 10-year yield went noticeably lower right away. So, so I saw an economist do this, which I, you know, shame”
“It's become the highest correlation I've seen in many many years and this is really just kind of like the last six or seven weeks”
“So, think of mortgage rates the base level is 650 to 675”
How the episode opens
Welcome everyone. I'm joined today by my podcast partner in crime, lead analyst Logan Moto Shami to talk about the inflation and mortgage rate outlook for 2027. Before we dive in, here are the top five trending articles on housingwire.com.
First, we have new credit score pricing grids point to higher borrower costs report shows, followed by mortgage rates 7% as oil hits $100 and yields climb. Then we have homeowners insurance costs hit another record high in the second quarter and the MLS of 2030 will be defined by who controls housing data. Finally, we have putting the road act into action faces a funding and HUD gauntlet.
Okay, we're ready to dive in. Logan, welcome back to the podcast.
Why do you always laugh at me when I put throat spray on? — If people could only see what happens before we we start recording is hilarious.
I talk a lot throughout the day. I just I I always think about this because I used to be a high school basketball coach of the last century. And I don't think I could yell like I did back in because it, you know, after like a two podcasts or interview or one presentation, my voice hears it.
So, I use it. There goes the throat spray. That's what happened.
And there's there's usually a lot of hair adjusting, although uh really I mean it's always it always looks great. So,
All right. Well, we have a lot to talk about. We I mean, wow. I I love that you're doing um you know, a preview of what to expect in 2027. — You know, I only do my forecasts always at the end of the year to take all the variables and put them in there.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- inflation outlook 2027
- mortgage rate outlook 2027
- mortgage rates
- oil prices
- bond yields
Watch the episode
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Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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