Episode summary
The good, the bad and the ugly are back for mortgage rates
HousingWire Daily
· · 22 min · Hosts: Sarah Wheeler · Guests: Logan Mohtashami
Summary
Mortgage rates got a modest reprieve as Logan Mohtashami argued that the market is finally reacting to three forces at once: easing conflict risk, softer economic data, and a more complicated Fed backdrop. He said the Iran ceasefire reduced the worst-case oil shock scenario, helping push the 10-year Treasury yield back toward 4.46%, which he framed as an important first target level after the recent spike to 4.68%. But he also stressed that the situation is not “fixed” yet; energy prices, shipping flows, and the Fed’s messaging still matter for where mortgage rates go next.
On the data side, Logan said jobless claims remain historically low at 215,000, while recent PCE and consumption data are mixed enough to keep the bond market engaged. He argued that if economic data softens over the next 4 to 6 weeks while the conflict keeps fading, the Fed will have to change its rhetoric. He also noted the irony that Lisa Cook is sounding more dovish than some would expect, even as other Fed officials remain hawkish.
For housing, Logan said new home sales are still basically sideways over a long time frame. Despite volatility and headline swings, he argued builders are managing supply rather than driving a strong expansion, and that the real issue is the level of completed homes for sale. Rates, he said, may ease gradually, but only with continued improvement in oil, diesel, and broader financial conditions.
Key takeaways
- Logan Mohtashami said the ceasefire in the Iran conflict removed the biggest near-term oil shock risk and helped pull the 10-year yield back toward 4.46%.
- He said mortgage rates can move lower from here only in steps, with better spreads, lower energy costs, and calmer shipping conditions still needed.
- Logan said jobless claims at 215,000 remain historically low, so the labor market is not yet flashing recession.
- He argued the Fed may have to soften its rhetoric if the next 4 to 6 weeks bring weaker economic data and less conflict-driven inflation pressure.
- He said new home sales are still broadly sideways over years, with builders managing supply rather than launching a new growth phase.
Notable quotes
“the good, the bad, and the ugly, you know, where they're all staring at each other and we can finally put all three characters into kind of the same plot now”
“the 10-year yield is right at 4.46 percent, uh kind of that first target level, and we're going to try to make sense of it all to move forward”
“The onus is now on the Fed to start maybe changing their rhetoric if that is the case going out in the future”
“We do not want to go into the recession talk until jobless claims four-week moving average heads up toward 323,000”
“new home sales and housing starts are very volatile month to month. That's how the census is”
How the episode opens
Welcome everyone. My guest today is lead analyst Logan Mohtashami to talk about what the Iran peace deal, today's economic data, and the Fed's stance on inflation mean for mortgage rates. As always, I want to thank our sponsor Total Expert for making this episode possible.
And I want to recap the top five trending stories on housingwire.com. Logan's article on what happens to mortgage rates if the Iran conflict is over continues to dominate. And then we have housing markets are adapting to higher rates instead of freezing.
Next is Two Harbors stalls on CCM merger approval. And two on Zillow, we've got Zillow and CoStar continue to spar over Matterport 3D tours. And RealTracks may suspend Zillow listing feed on June 1 over IDX rule.
You can read all of the incredible content with the code podcast20 to get a 20% discount on a subscription. Okay, ready to dive in? Logan, welcome back to the podcast.
It is wonderful to be here. What a week. What a day.
It's Thursday morning and the last 16, 17 hours were a lot of drama, but really, really beneficial for everyone listening uh to this podcast today on kind of like now mortgage rates, is it just the conflict or economic data or the Fed or all together? I feel like you know, the good, the bad, and the ugly, you know, where they're all staring at each other and we can finally put all three characters into kind of the same plot now because I thought what happened Wednesday night and Thursday morning and everything where we are right now, the 10-year yield is right at 4.46 percent, uh kind of that first target level, and we're going to try to make sense of it all to move forward.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- mortgage rates
- fed stance on inflation
- housing data
- iran peace deal
- new home sales
Watch the episode
Watch “The good, the bad and the ugly are back for mortgage rates” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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