HousingWire Daily Why Jerome Powell is wrong about housing
Dec 15, 2025
In this discussion, Logan Mohtashami, a lead housing analyst known for his sharp insights on the housing market, challenges Jerome Powell's claim that the Fed lacks tools to influence housing. He highlights how Fed policy impacts mortgage rates and housing permits. Logan argues that builders respond to actual demand rather than hype, and reviews the inventory dynamics across the U.S. He also reflects on the extreme low inventory in early 2022 and how current metrics show signs of a healthier market with increased buyer choices.
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Fed Controls Mortgage Rate Direction
- Logan Mohtashami argues the Fed controls 65–75% of where mortgage rates go and thus heavily influences housing demand.
- He says Jerome Powell claiming the Fed has no tools to affect housing is incorrect and misleading.
Rates Drive Builder Confidence
- Lower mortgage rates (around 6%) revive builder confidence and increase permits and starts, Logan says.
- He cites late 2022/early 2023 when rates fell and single-family permits began rising as proof.
Builders Follow Demand, Not Hype
- Builders build to their demand curve and avoid piling up unsold inventory, Logan emphasizes.
- He argues underbuilding wasn't the issue; weak demand and product pricing shaped starts and permits.