Insights on Mortgage Purchase Application Data
Positive trends continued for purchase application data last week, with both weekly and yearly growth. The aim is to sustain 12-14 weeks of consecutive week-to-week gains, and progress is being made in that direction. The latest numbers show a 5% week-over-week increase and an 18% year-over-year growth. It’s noteworthy that despite the removal of the low threshold for year-over-year growth in 2026, double-digit growth has been consistent for two weeks.
These applications are often indicative of future sales data, typically leading by 30 to 90 days. The 2026 data so far includes:
- 2 weeks with positive week-over-week results
- 0 weeks with negative week-to-week prints
- 2 weeks of double-digit year-over-year growth
Analysis of Weekly Pending Sales
Weekly pending home sales provide a snapshot of short-term trends, influenced by factors like holidays and fluctuations. Last week saw growth in both week-to-week and year-over-year metrics, marking the highest weekly pending sales in recent years. These figures are typically reflected in the existing home sales report 30 to 60 days after being recorded.
Comparing weekly pending sales for the past years:
- 2026: 56,252
- 2025: 52,165
Insights on 10-Year Yield and Mortgage Rates
The forecast for 2026 anticipated specific ranges for mortgage rates and the 10-year yield, which were impacted by global events and market volatility last week. Mortgage rates experienced a slight increase, ending the week at 6.19%. Despite the fluctuations, the rates remained relatively stable given the circumstances.
For more detailed insights, you can refer to the visual representation below:
Understanding Mortgage Spreads
Mortgage rates have been relatively stable due to significant improvements in mortgage spreads, especially in the early part of the year. The current spreads have helped mitigate rate increases, maintaining rates lower than what would have been expected in similar market conditions last year.
Historically, mortgage spreads have ranged between 1.60% and 1.80%. Last week, spreads closed at 1.82%, indicating a positive trend. The visual representation below provides further insights:
Analysis of Weekly Housing Inventory Data
Positive trends have been observed in housing inventory as the market moves towards normalization. However, the growth rate has slowed compared to the previous year, with more challenging year-over-year comparisons expected in 2026. Despite this, any growth from the current levels is considered positive.
- Weekly inventory change (Jan. 16-Jan. 23): Inventory rose from 695,628 to 697,868
- Same week last year (Jan. 17-Jan 24): Inventory rose from 632,076 to 635,529
Insights on New Listings Data
The new listings data for 2026 continues to show positive signs. The goal is to surpass 80,000 new listings per week during peak periods, with last year seeing growth up to that point before stalling. Contextually, during the housing bubble crash, listings were significantly higher. Comparing new listings data for the past two years:
- 2026: 53,920
- 2025: 50,946
Understanding Price-Cut Percentage
Price reductions are a common occurrence in the housing market, with around a third of homes experiencing them. As mortgage rates remain elevated, homeowners adjust prices to align with supply and demand dynamics. It will be crucial to monitor how the market responds to the current rate environment compared to previous years.
For detailed insights into the price-cut percentage, refer to the visual representation below:
Preview of the Week Ahead: Fed Meeting, Home Prices, and Inflation
This week, the Federal Reserve meeting is scheduled, with expectations of no rate movements. Market participants will closely watch the Q&A session as Jerome Powell concludes his term and a new Fed chair is anticipated to be announced. Additionally, reports on home prices and PPI inflation data are set for release, alongside developments in international trade agreements.