Did recent wild mortgage rate swings impact housing data? by Logan Mohtashami for HousingWire

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Last week, the financial markets reminded us of their dynamism as the 10-year yield rose sharply, pushing mortgage rates higher, but did it impact the housing market data? We’ve witnessed a solid year with purchase application data and our pending home sales contract data has shown year-over-year growth recently. However, did this last move in rates finally break the streak.

Purchase application data

Imagine a scenario where the markets weren’t grappling with the aftershocks of the Godzilla Tariffs. In that case, the buzz for the year would be all about the housing market beating  expectations based on housing data — despite those elevated mortgage rates. The latest purchase application data continues to grow with 9% week-over-week growth and 10% year-over-year increase, all while mortgage rates have consistently hovered above 6.64% throughout most of the year!

Here is the weekly data for 2025:

• 7 positive readings
• 3 negative readings
• 3 flat prints

It’s important to note that the situation was quite different last year when mortgage rates began to rise at the start of the year toward 7.50%. Last year, we had a weekly purchase application trend with 14 weeks of negative data prints and only two positive and flat prints. Consequently, I anticipate a hit toward purchase applications data next week, consistent with the trends observed in the data over the past few years when rates move up fast in a week from a positive week. That said, if mortgage rates can approach 6%, it will be an easy slam dunk for existing home sales growth in 2025 since the bar is historically low.

Weekly pending sales

The latest weekly total pending contract data from Altos offers valuable insights into current trends in housing demand. Usually, it takes mortgage rates to trend closer to 6% to get real growth in the housing demand data lines, but we have recently seen some pickup on the weekly sales data, and now our total pending sales data is positive year after year. 

Weekly pending contracts for the last week over the past several years:

• 2025: 377,633
  2024: 371,457
• 2023: 335,017

10-year yield and mortgage rates

In my 2025 forecast, I anticipate the following ranges:

• Mortgage rates will be between 5.75% and 7.25%
• The 10-year yield will fluctuate between 3.80% and 4.70%

In the previous tracker article, I highlighted that the 10-year yield would unlikely have fallen below 4% without Godzilla tariffs. Last Sunday night, I expressed concern that a single statement from the White House could result in a significant uptick in yields that would be face-ripping, which ideally should have led the 10-year yield back to 4.35%. However, the events of Thursday night and Friday revealed increased stress selling in the bond market, prompting some concern in the White House, as they had forecast lower 10-year yields.

This week has been challenging for mortgage rates, and the prevailing volatility is understandably creating difficulties for consumers and industry professionals. As a result, we might anticipate a decline in purchase applications next week. We hope circumstances will stabilize soon, fostering a more predictable environment for everyone involved.

Mortgage spreads

Mortgage spreads started showing positive trends in 2024, and at the start of the year, that improvement continued. However, with a backdrop of market volatility, the spreads got worse recently. Despite the less favorable spreads, if mortgage spreads were as bad as in 2023, mortgage rates would be near 8%, and the entire favorable trend in housing this year would not have happened. If mortgage spreads were back to normal today, we would be near 6%.

Weekly housing inventory data

Spring is finally here, and I can’t help but feel exhilarated about the incredible story unfolding in the housing market for 2024 and 2025 — the growth of inventory! While we haven’t quite reached normal levels yet, our progress is a positive trend for the entire housing market, which is no longer savagely unhealthy. We had another week of good inventory growth.  

• Weekly inventory change (April 4 -April 11): Inventory rose from  691,197- 702,434
• The same week last year (April 5 -April 12): Inventory rose from 512,930-526,479
• The all-time inventory bottom was in 2022 at 240,497
• The inventory peak for 2024 was 739,434
• For some context, active listings for the same week in 2015 were 1,021,567

New listings data

The new listings are a positive story in the housing market in 2025. Last year, I estimated that a minimum of 80,000 homes would be listed during the peak seasonal months, and my prediction was only off by 5,000. This year, we will achieve that target. Some 70% to 80% of home sellers and buyers, and this shift reflects a positive trend as we work towards a more balanced market.

To give you perspective, during the years of the housing bubble crash, new listings were soaring between 250,000 and 400,000 per week for many years. The growth in new listings data is just trying to return to normal, where the seasonal peaks range between 80,000 and 110,000 per week. The national new listing data for last week over the previous several years:

• 2025: 76,270
• 2024: 66,776
• 2023: 48,556

Price-cut percentage

In a typical year, approximately one-third of all homes experience a price reduction, showcasing the dynamic nature of the housing market. As we navigate the current rise in inventory levels and relatively high mortgage rates, we observe an increase in the proportion of homes undergoing price adjustments. This trend reflects the market’s evolution and our ability to adapt to changing circumstances. However, we have seen some stablization in this data line in the last two weeks. Now that rates have increased, we will observe what impacts can happen over the following few rates if rates stay elevated.

For the remainder of 2025, I confidently project a modest increase in home prices of approximately 1.77%. At the same time, this suggests another year of negative real home price growth — the current availability of homes and elevated mortgage rates back this outlook. A significant shift in mortgage rates to around 6% could alter this trajectory. My 2024 forecast of 2.33% proved wrong, as lower rates in 2024 made my forecast too low.

The rise in price cuts this year compared to last strongly reinforces my belief that my conservative growth price forecast for 2025 is solid and well-supported. Below are the price cuts from previous weeks over the last several years:

• 2025: 35%
• 2024: 32%
• 2023: 30%

The week ahead: Nothing matters until markets calm down

Just like last week, the excitement continues! Until the markets gain some clarity, the economic data is taking a backseat. And guess what? Even though CPI and PPI inflation figures came in lower than expectations, the impact was nearly nonexistent!

Next week is heating up with a slew of Fed Presidents ready to share their thoughts. Don’t miss Monday’s podcast, in which I’ll dive into a hot topic: Can President Trump fire Fed Chairman Jerome Powell? Plus, we’ve got crucial retail sales and housing starts data coming our way — these are the key indicators we need to monitor as we navigate the economic landscape. Also, some exemptions made on big tech products coming from China were announced this morning, so there is more moving news.

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