Episode summary
Iran war escalation spurs mortgage rate volatility
HousingWire Daily
· · 21 min · Hosts: Sarah Wheeler · Guests: Logan Mohtashami
Summary
Logan Mohtashami argued that the recent escalation in the Iran conflict has already changed the mortgage-rate outlook for 2026 by pushing the 10-year yield sharply higher and reviving the possibility of rate hikes. He said the market had been hoping for an offramp, but the conflict now looks more prolonged, with the risk of embedded inflation if the fighting extends beyond March 21 and into weeks of additional bombing.
He said the bond market is now driving the story: the 10-year yield jumped to 4.36, mortgage-rate volatility is rising, and the administration’s earlier focus on lower energy costs and lower mortgage rates is getting undercut by higher oil and input costs. Logan said he is not ready to change his mortgage forecast yet, but if the 10-year yield pushes above 4.60, he would revisit the outlook and higher mortgage rates could become more likely.
For housing, he warned that a return toward 7% mortgage rates would slow demand and complicate the spring and summer market. Up to this week, pending sales and purchase applications had been holding up, but he said a renewed rate spike would likely reverse that progress and bring back the kind of housing volatility the market had avoided for much of the year.
Key takeaways
- Logan Mohtashami said the conflict has pushed the 10-year yield to 4.36 and broken the earlier low-volatility bond pattern.
- He said a prolonged escalation could price in embedded inflation and even raise the odds of Fed rate hikes in 2026.
- Mohtashami said he would not change his 2026 mortgage forecast unless the 10-year yield moves above 4.60.
- He warned that if mortgage rates drift back toward 7%, housing demand and spring market momentum could weaken quickly.
- Mohtashami said the administration’s lower-rate, lower-energy-cost goals are being challenged by higher oil and input costs.
Notable quotes
“if this didn't end, then it's something bigger than all of us thought”
“So, the 10-year yield, oddly enough, the day before the 21st, right, as of this second is 436”
“I don't change the forecast until I see the 10-year yield get above 460 because of the spreads”
“But now if we start to go back up to 7%, we know what happens in housing”
How the episode opens
Welcome everyone. My guest today is lead analyst Logan Moto Shami to talk about what's happening with the Iran war and how that's going to affect mortgage rates and the housing market for the rest of 2026. Before we jump in, I want to thank our sponsor, Trust and Will, for making this episode possible.
Logan, welcome back to the podcast. Madame President, is there any way I can get Chloe to come uh help us with charting war economics with these crazy headlines? Wow.
Wow. Wow. It is Friday morning and boy, the last like 18 hours have been very, very interesting.
And it's March 20th. So, tomorrow would be March 21st. By the time this podcast comes out, it'll be past that uh uh beaker for me.
So it's it's we are in a very very uh interesting spot with the economy this conflict with the 10-year yield oral everything because we have now gone that full time frame that I would have to reassess everything if we're still in this conflict by the 21st of March.
I think you know we're not still just still in this conflict. It seems to be escalating. Um we we thought yesterday on Thursday there was there was a little uh there was a drop in oil prices that made made us go hey what's going on and um we thought maybe you know we had found an offramp but it feels like today the offramp is is even farther away than it was.
So during the day on Thursday uh Net Nihalu came out and said maybe the you know we have 20 days of bombing maybe you know Iran can't make missiles or enrich uranium. So the 10-year yield fell right away and oil prices fell. Then after that everything kind of turned.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- mortgage rate volatility
- iran conflict escalation
- mortgage rates
- housing market outlook
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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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