Iran battle
Now, historically, when there was army battle within the Center East, folks would count on cash to movement into the U.S. greenback and the U.S. bond market as a protected haven, and oil costs would rise. However in the previous few years, this actually hasn’t occurred.
A part of this, I consider, is that merchants don’t worry a wider escalation within the Center East and see these occasions being contained. With the midterms arising, there isn’t a worry of a protracted, protracted conflict with Iran, and Trump appears to love a fast repair and nothing too extended relating to army actions.
We’ll regulate Sunday night time buying and selling and what occurs Monday morning, but when this goes like different current occasions, it won’t have a chronic affect. One key might be watching the provision of oil by way of the Strait of Hormuz. The bond market and mortgage charges haven’t had an excessive amount of wild motion this 12 months regardless of some actually wild headlines. The assault on Iran might be one other check of this.
10-year yield and mortgage charges
Within the 2026 HousingWire forecast, I anticipated the next ranges:
- Mortgage charges between 5.75% and 6.75%
- The ten-year yield fluctuating between 3.80% and 4.60%
Friday was a loopy day. Coming off an excellent jobless claims report and a scorching PPI inflation report, you’d have thought the 10-year yield and mortgage charges can be greater. Nonetheless, that wasn’t the case. Shares have been promoting off, there was adverse sentiment on AI taking jobs away and possibly bond merchants bought a heads-up on the Iran scenario, which despatched the 10-year yield straight to a key stage on Friday. And this week is jobs week!
I get nearer to the underside finish of my forecast for 2026 on the 10-year yield and mortgage charges, so this week might be very essential to see not solely how the markets react to the Iran scenario, but in addition the roles information.
In any case, the 10-year yield closed at a 2026 low and charges ended the week decrease at 5.99%, in line with Mortgage News Daily, whereas Polly’s mortgage rate lock data exhibits a weekend charge of 6.23%.
Mortgage spreads
Mortgage spreads stay a constructive story for housing in 2026, decreasing mortgage-rate volatility, and are near regular ranges.
Traditionally, mortgage spreads have ranged from 1.60% to 1.80%. Final week’s spreads closed at 1.93%.
If spreads matched the 2023 peak ranges, mortgage charges can be 1.20 proportion factors greater, at 7.17%. With spreads returning to regular, mortgage pricing can stay decrease for longer than in earlier years.
Realistically, we solely have 20-34 foundation factors of enchancment left within the spreads. The longer that volatility is compressed, the higher spreads can get later within the 12 months, however the massive enchancment right here has already run its course.
Weekly pending gross sales
Pending dwelling gross sales information offers a week-to-week perspective, although outcomes will be affected by holidays and short-term fluctuations, such because the giant winter storm in January. We have been exhibiting year-over-year progress initially of the 12 months, and that snowstorm did gradual issues down.
We simply had back-to-back weeks of constructive year-over-year progress; this was the case earlier than the snow impacted the housing information. Now we must always have yet another current dwelling gross sales report that might be impacted by the snow information and we are able to transfer on to these studies, however you may get the most effective forward-looking information right here.
Weekly pending gross sales final week during the last two years:
- 2026: 63,209
- 2025: 60,410
Mortgage buy utility information
Buy utility information is a forward-looking information line: the expansion right here leads gross sales roughly 30-90 days out, and we noticed 12% year-over-year progress on this information line final week.
Nonetheless, what I actually worth is at the very least 12-14 weeks of constructive weekly progress. If you may get this along with year-over-year progress, we’ve one thing legit for certain. For 2026, each week has proven constructive year-over-year progress. Over the past two weeks, the year-over-year progress proportion has elevated greater now that the snow affect has melted away.
As you may see within the chart under, we do have some seasonality within the weekly information.
Right here’s 2026 to date:
- 2 constructive week-over-week prints
- 4 adverse week-to-week prints
- 1 flat week-to-week print
- 4 weeks of double-digit year-over-year progress
- 7 weeks of constructive year-over-year progress
Weekly housing stock information
Housing stock information fell final week, which isn’t too surprising, since this week has proven declines prior to now, so I wouldn’t put a lot weight on this week’s information. Hopefully, we’ll see the standard seasonal improve in stock beginning in March. Stock is at a lot more healthy ranges now than a couple of years in the past.
We’ve gone from 33% year-over-year progress in stock on the highest level in 2025, to eight.04% final week.
- Weekly stock change: (Feb. 20-Feb. 27): Stock fell from 700,259 to 690,357
- Similar week final 12 months: (Feb. 21-Feb. 28): Stock fell from 640,221 to 639,357
New listings information
New listings information additionally confirmed a weekly dip, which I chalk as much as seasonal shifts within the information. We must always get new listings information above 80,000 throughout the seasonal peak months, which might be the realm of what regular new listings would appear like on the low finish.
I hope for the brand new listings information to vary between 80,000 and 100,000 per week throughout the seasonal peak durations, because it did from 2013-2019. For context, throughout the housing bubble crash, new listings ranged from 250,000 to 400,000 per week for a number of years.
Right here is final week’s new listings information for the previous two years:
- 2026: 50,245
- 2025: 60,410
Value-cut proportion
Sometimes, about one-third of properties bear worth reductions earlier than they promote, reflecting the dynamic nature of the housing market. As mortgage charges and stock rise collectively, the proportion of worth cuts will increase.
Nonetheless, charges are close to multiyear lows, so we at the moment are seeing adverse year-over-year price-cut proportion information. This shouldn’t be stunning on condition that demand has picked up barely and stock progress has slowed. We’re beginning the seasonal shift greater within the price-cut information so the year-over-year information might be key.
The worth-cut proportion final week is now 1.25% decrease than this time final 12 months.
The worth-cut proportion for final week:
The week forward: Iran, jobs week, retail gross sales and extra
To maintain it easy, this week might be nuts! Not solely do we’ve the Iran scenario, which might both settle down or escalate, nevertheless it’s jobs week! We even have the ISM and retail gross sales report, Fed speeches and the jobless claims.
It would get hectic this week, but in addition do not forget that mortgage spreads being higher has compressed volatility with charges. Nonetheless, we all the time watch how the bond market reacts to the roles information, which for me has all the time been the important thing.
