Episode summary
Will mortgage rates go higher with Iran escalation?
HousingWire Daily
· · 23 min · Hosts: Sarah Wheeler · Guests: Logan Mohtashami
Summary
Logan Mohtashami argues that the renewed Iran conflict has pushed mortgage-rate risk higher, but not enough to justify panic. He says oil has moved sharply, yet the bond market has been more negative on the conflict than the oil market itself, with the 10-year yield around 4.60% and mortgage spreads still helping keep rates below the extremes seen in 2023.
His core view is that most of the move in rates is already priced in. Logan says the Fed has effectively delivered the equivalent of rate hikes through higher short-term market yields, and that a worst-case mortgage rate above 7.25% would require a much firmer economy, continued conflict, and a more hawkish Federal Reserve. He repeatedly argues that the Fed has already gotten what it wanted: tighter financial conditions without an official hike.
On housing data, Logan says the July 4th bounce in weekly numbers was expected and not very meaningful. The bigger issue in the second half of 2026 is harder year-over-year comps, which could make sales and inventory look flat even if demand does not collapse. He expects the market to stay constrained unless rates retreat back toward the low 6% range.
Key takeaways
- Logan Mohtashami says the worst-case mortgage-rate ceiling is around 7.25%, but only if the conflict persists and the economy stays firm.
- He argues the Fed has already gotten its effective rate hikes through higher 2-year and 10-year yields, even without a formal move in the funds rate.
- Mohtashami says mortgage spreads remain the housing market’s “saving grace,” keeping rates below the 2023 peak scenario.
- He expects second-half 2026 housing data to be harder to read because year-over-year comps get tougher while rates stay elevated.
- Mohtashami says the July 4th rebound in weekly housing data was normal and not a sign of renewed demand strength.
Notable quotes
“the bond market does not like the conflict, right? Oil prices have gone up and down like crazy”
“the Federal Reserve did this. They wanted rates higher, right? and and the conflict was something they talked about negatively going up and they said nothing about it coming down”
“going out for the rest of the year, we have harder year-over-year comps”
How the episode opens
Welcome everyone. My guest today is lead analyst Logan Moto Shami to talk about whether mortgage rates are going to go higher with the reescalation of the Iran conflict. Before we get started, here are the top five trending articles on housingwire.com.
Leading the list is Logan's housing market tracker. Can the housing market weather Iran conflict 2.0 and higher rates? That's followed by how the road act aims to boost housing supply and cut red tape and the housing market's inventory rebound is shifting power to buyers but not everywhere.
Then we have foreclosures climbed 21% in the first half of 2026. And finally, Compass files ethics complaints against Zillow in 26 states. Okay, we're ready to get started.
Logan, welcome back to the podcast. It is wonderful to be here back in Irvine, California. And I gotta tell you, I just, you know, going to Lincoln City.
I just I get weird looks because of the hair. You know,
I can only imagine what people in Lincoln City, Oregon are are thinking as you're walking down the street with your hair.
I've had three different people, you know, over there. Are you an actor? You know, just because the hair flows and then because it's windy, it's like, you know, my hair is just all over the place.
Um very very interesting weekend, very interesting Monday morning. Um this is like I think the 10th day of uh the conflict and more bomb 10th straight day of bombing with missiles and drones. Oil prices last time I checked was like 82 83.
And what we've always talked about oil prices here is like 67 could be the bottom here and you know 82 that's a very tradable range. That's a range that we were accustomed to.
From the episode’s captions: roughly the first two minutes, lightly cleaned. Keep watching on YouTube →
Topics
- mortgage rates
- iran escalation
- housing market
- fha mortgages
- va mortgages
Watch the episode
Watch “Will mortgage rates go higher with Iran escalation?” on YouTube
Summary, takeaways and quote selection by Octagon. Quotes are short excerpts; the full conversation is in the episode.
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