Episode summary
What’s happening with the bond market?
HousingWire Daily
· · 24 min · Hosts: Sarah Wheeler · Guests: Logan Mohtashami
Summary
Logan Mohtashami argued that the latest bond-market move is best understood as a technical break, not a fundamental shift. He said the 10-year Treasury yield had been holding a key 5.35% line, and once that level broke, traders were forced to reassess. The move below 5% to 4.97% is positive for rates, but he said the real confirmation would be follow-through below 4.70%.
He also said mortgage rates do not move one-for-one with the 10-year yield because lenders manage spreads, payoff risk, and margins. That means rates can improve gradually even if the Treasury move is sharp. Mohtashami laid out a pathway to sub-7% mortgage rates, but tied it to more than just yields: lower oil prices, less conflict, and a trade-war environment that does not worsen.
On the macro side, he said the AI buildout is still supporting the economy and remains inflationary in the Federal Reserve’s eyes. He and the host also debated construction labor, with the host arguing immigration-related disruptions could be changing the labor picture, while Mohtashami said builders usually find labor when housing demand is strong and that recession signals are more tied to falling construction activity than labor complaints alone.
Key takeaways
- Mohtashami said the 10-year yield breaking below 5% is encouraging, but he wants a close under 4.70% before calling it a durable trend.
- He argued mortgage rates can keep drifting lower even without a huge Treasury rally because lender spreads and payoff risk matter.
- Mohtashami tied sub-7% mortgage rates to follow-through in bonds plus lower oil, less conflict, and no escalation in trade war 2.0.
- He said the AI buildout is still propping up the economy, while the Fed treats it as inflationary.
- He pushed back on the idea that construction labor shortages alone signal recession, saying builders typically find labor when demand is strong.
Notable quotes
“We had one basic premise. The tenure yield needs to hold at 5.35%. Right”
“So for all the all the clowning men that run around and we're on the verge of a collapse and everything when yields rise”
“I really like to see the 10-year yield get below 470 and get follow through bond selling after that”
“don't put too much stock into this move until you can close below 470 and get follow-rough bond selling”
How the episode opens
Welcome everyone. I'm joined today on this award-winning podcast by my podcast partner, lead analyst Logan Motoshami to talk about bond markets going wild and what's next. Before we dive in, here are the top five trending stories on housingwire.com.
First is a White House executive order would seek to cut mortgage costs, followed by MLS's sue Compass in proactive move to defend cooperation rules. Then we have why lower home prices aren't bringing buyers back to the housing market and Compass sues former ERRA president Alex Fidal over move to ReMax. Finally, we have down payment assistance availability peaks again.
Okay, we are ready to get started. Logan, welcome back to the podcast. It is wonderful to be here and just just think of the theme Gladiator the movie coming down the hill.
Hold the line. Stay with me. Stay with me and then go and attack.
And that is kind of what's happening in the bond market. You know, I I I'm such not a believer of mortgage rate forecasting. I think that's always been a like a dinosaur way of looking at economics, just giving like a yearly thing and updates on quarter.
I believe on following the 10-year yield and the 30-year mortgage and spreads and doing the slow dance. Oh, by the way, we were in Seattle and when I was on stage talking about the slow dance, we had a live DJ and he he was playing Jodicy right when I was uh uh I got to do a little bit of dancing. And I was like, "Oh, if Sarah Wheeler was on stage with me, she couldn't get away with that one.
You know,
I we heard lots of feedback, positive feedback. People went crazy for you in — Yes. And I'm a Niner fan.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- bond market
- 10-year yield
- mortgage rates
- interest rates
- rate outlook
Watch the episode
Watch “What’s happening with the bond market?” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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