Episode summary
How much higher can rates go?
HousingWire Daily
· · 24 min · Hosts: Sarah Wheeler · Guests: Logan Mohtashami
Summary
Mortgage rates pushing above 7% were framed as a function of the bond market, not a simple Fed story. Logan Mohtashami argued that the jump is being driven by the “slow dance relationship” between the 10-year yield and mortgage rates, with oil above $100 and rising geopolitical तनाव pushing yields higher. He said this move is still within the range he had warned about, but that rates could break higher if the 10-year yield gets above 5% and the conflict keeps worsening.
Logan argued that the market has already priced in a lot, and that the Treasury and White House cannot easily force rates lower when inflation, oil, and yields are moving against them. He said mortgage rates could move toward 7.13% to 7.18% under the current setup, but going to 7.5% or 8% would require a much bigger move in the 10-year and a more supportive Federal Reserve stance. He also stressed that there has been no Fed rate hike this year, so the bond market is moving ahead of policymakers.
The episode also used existing home sales data to show how higher rates are slowing housing activity. Logan pointed to sales falling to 3.98 million and said inventory is no longer evidence of a “housing shortage” in the old sense, because more active listings and faster transaction cycles change how supply shows up in the data.
Key takeaways
- Logan Mohtashami said mortgage rates above 7% are being driven mainly by the 10-year yield, oil prices, and conflict risk, not just Fed policy.
- He put the near-term ceiling around 7.13% to 7.18% unless the 10-year yield breaks above 5%.
- Logan said moving mortgage rates to 7.5% or 8% would likely require the Federal Reserve to tolerate a much higher long end and the conflict to worsen further.
- Existing home sales fell to 3.98 million, which Logan said is consistent with mortgage rates above 6.65% and especially above 7%.
- Logan argued that rising inventory does not automatically mean weak demand, because today’s faster transaction cycle changes how supply shows up in the data.
Notable quotes
“It took the 10-year yield to get to 4.92%, Brent crude above 100 three times, and the conflict escalating out of control with crazy headlines that it's not going to end soon to get mortgage rates above 7%”
“if the conflict keeps on pushing the 10-year yield, especially above 5%, it it should break, right”
“It's like all of a sudden they they hey, they didn't raise rates. Who cares? The 10-year yields at 492”
How the episode opens
Welcome everyone. Today I'm joined by lead analyst Logan Motoshami to talk about mortgage rates and whether they can go even higher. Before we dive in, here are the top five trending stories on housingwire.com.
First is Logan's story that we're going to be talking about today, of course, which is mortgage rates top 7% as oil hits $100 and yield and yields climb. Followed by Rocket raises conforming loan limit to $845,000. Then we have GSE's open Vantage score 4.0 to all single family lenders and the housing market spotlight when housing market signals don't agree.
Finally, we have what Dr. Horton's 2027 budget tells rivals about pricing pressures. Okay, we're ready to dive in.
Logan, welcome back to the podcast. Even though I'm I'm sad we're having to discuss over 7% rates.
Hey, listen. As I explained to people on on X early, man, it it could be a lot worse. I mean, I I highlighted that if this was 2023 worst spreads, mortgage rates are above 810.
If this was 2024, mortgage rates are near 8%. If this was last year in 2025, mortgage rates are above 7 and a half. So mortgage spreads did as good as it possibly could.
But as always, what drives the 10-year yield and 30-year mortgage rate is that slow dance relationship. And the conflict is getting to a stage that I I don't I understand that Scott Bessant knows like what's what's going on in the market, you know, cuz last year when Godzilla tariffs happened and the 10-year got to 460, they went into the White House and they told Trump after locking Peter Navaro out that you you need to tweet this because this isn't working. But, you know, for those that listen to us on YouTube, please comment on what kind of drink do you think Kevin Worsh and Scott Bessett are having right now.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- mortgage rates
- interest rate outlook
- housing affordability
- mortgage lending
- conforming loan limits
Companies and tickers mentioned
- RKT
- UWMC
- DHI
- Rocket Companies
- UWM Holdings
- D.R. Horton
Watch the episode
Watch “How much higher can rates go?” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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