Iran battle
Now, historically, when there was navy battle within the Center East, folks would anticipate cash to move into the U.S. greenback and the U.S. bond market as a secure haven, and oil costs would rise. However in the previous couple of 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 developing, there isn’t a worry of a protracted, protracted battle with Iran, and Trump appears to love a fast repair and nothing too extended relating to navy actions.
We’ll keep watch over Sunday night time buying and selling and what occurs Monday morning, but when this goes like different latest occasions, it won’t have a chronic impression. One key shall be watching the provision of oil by means of the Strait of Hormuz. The bond market and mortgage charges haven’t had an excessive amount of wild motion this yr regardless of some actually wild headlines. The assault on Iran shall be one other take a look at 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 a very good jobless claims report and a sizzling PPI inflation report, you’ll have thought the 10-year yield and mortgage charges could be greater. Nonetheless, that wasn’t the case. Shares had been promoting off, there was damaging sentiment on AI taking jobs away and perhaps bond merchants obtained a heads-up on the Iran scenario, which despatched the 10-year yield straight to a key degree 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 shall be very crucial to see not solely how the markets react to the Iran scenario, but additionally the roles knowledge.
In any case, the 10-year yield closed at a 2026 low and charges ended the week decrease at 5.99%, in keeping with Mortgage Information Every day, whereas Polly’s mortgage price lock knowledge reveals a weekend price of 6.23%.
Mortgage spreads
Mortgage spreads stay a optimistic story for housing in 2026, lowering 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 could be 1.20 share 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 yr, however the huge enchancment right here has already run its course.
Weekly pending gross sales
Pending dwelling gross sales knowledge supplies a week-to-week perspective, although outcomes will be affected by holidays and short-term fluctuations, such because the large winter storm in January. We had been displaying year-over-year progress in the beginning of the yr, and that snowstorm did gradual issues down.
We simply had back-to-back weeks of optimistic year-over-year progress; this was the case earlier than the snow impacted the housing knowledge. Now we should always have another present dwelling gross sales report that shall be impacted by the snow knowledge and we will transfer on to these studies, however you will get the perfect forward-looking knowledge right here.
Weekly pending gross sales final week during the last two years:
- 2026: 63,209
- 2025: 60,410
Mortgage buy utility knowledge
Buy utility knowledge is a forward-looking knowledge line: the expansion right here leads gross sales roughly 30-90 days out, and we noticed 12% year-over-year progress on this knowledge line final week.
Nonetheless, what I actually worth is not less than 12-14 weeks of optimistic weekly progress. If you will get this along with year-over-year progress, now we have one thing legit for certain. For 2026, each week has proven optimistic year-over-year progress. During the last two weeks, the year-over-year progress share has elevated greater now that the snow impression has melted away.
As you may see within the chart beneath, we do have some seasonality within the weekly knowledge.
Right here’s 2026 up to now:
- 2 optimistic week-over-week prints
- 4 damaging week-to-week prints
- 1 flat week-to-week print
- 4 weeks of double-digit year-over-year progress
- 7 weeks of optimistic year-over-year progress
Weekly housing stock knowledge
Housing stock knowledge fell final week, which isn’t too stunning, since this week has proven declines previously, so I wouldn’t put a lot weight on this week’s knowledge. Hopefully, we’ll see the normal seasonal improve in stock beginning in March. Stock is at a lot more healthy ranges now than a number of years in the past.
We’ve got 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
- Identical week final yr: (Feb. 21-Feb. 28): Stock fell from 640,221 to 639,357
New listings knowledge
New listings knowledge additionally confirmed a weekly dip, which I chalk as much as seasonal shifts within the knowledge. We should always get new listings knowledge above 80,000 throughout the seasonal peak months, which might be the world of what regular new listings would seem like on the low finish.
I hope for the brand new listings knowledge 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 knowledge for the previous two years:
- 2026: 50,245
- 2025: 60,410
Value-cut share
Sometimes, about one-third of houses endure 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 damaging year-over-year price-cut share knowledge. This shouldn’t be shocking on condition that demand has picked up barely and stock progress has slowed. We’re beginning the seasonal shift greater within the price-cut knowledge so the year-over-year knowledge shall be key.
The value-cut share final week is now 1.25% decrease than this time final yr.
The value-cut share for final week:
The week forward: Iran, jobs week, retail gross sales and extra
To maintain it easy, this week could possibly be nuts! Not solely do now we have the Iran scenario, which may 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 additionally 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 knowledge, which for me has all the time been the important thing.
