HousingWire Daily
Logan Mohtashami on why mortgage rates are dropping
Feb 26, 2025
Logan Mohtashami, a lead analyst known for his deep insights into mortgage trends and economic impacts, discusses the recent drop in the 10-year yield and its effects on mortgage rates. He explores how economic softness is influencing these rates, linking insights from the US economic surprise index to future predictions. Mohtashami emphasizes how labor markets and builder confidence affect the housing sector, while providing an analysis of how Fed policies play a crucial role in shaping housing demand.
24:58
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Quick takeaways
- The recent decrease in the 10-year yield to 4.31% signifies a direct correlation with disappointing economic data impacting mortgage rates favorably for buyers.
- Labor market trends, including workforce decline and layoffs, indicate potential weaknesses that may further lower the 10-year yield and support housing demand.
Deep dives
Shifting Mortgage Rates and Economic Indicators
Recent changes in the 10-year yield have brought mortgage rates down, benefiting those in the housing market. The shift from a forecasted peak of 5% to a current yield of 4.31% indicates the influence of economic data not meeting expectations, which caused the yields to drop significantly. A series of disappointing economic indicators, including retail sales and manufacturing data, have contributed to this decline, revealing a trend where lower economic performance leads to lower bond yields. This cycle highlights the importance of monitoring economic trends, particularly as shifts in the 10-year yield directly impact mortgage rates, fostering a more favorable environment for potential homebuyers.
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