Mortgage spreads
My goal for this year was to improve mortgage spreads in light of rate volatility and the Fed’s rate-cut cycle. It is expected that the mortgage spread should have seen an improvement of 0.27% to 0.41% this year.
While we have made progress in optimizing mortgage spreads in 2025, there is still room for improvement. Historically, mortgage spreads have ranged between 1.60% and 1.80%. If we compare today’s spreads to the peak of 2023, mortgage rates would be significantly higher. Conversely, returning to the normal range could lead to lower mortgage rates between 5.76% and 5.96%.
Mortgage rates and the 10-year yield
In my 2025 forecast, I predicted mortgage rates to range between 5.75% and 7.25% and the 10-year yield to fluctuate between 3.80% and 4.70%.
Recent developments with the Fed have influenced mortgage rates and the 10-year yield. Despite some volatility, mortgage rates have remained near 6%. Fed Chair Jerome Powell’s stance and the upcoming change in Fed leadership have also been topics of discussion.
Purchase application data
Over the past 13 weeks, we have seen positive growth in purchase applications, with 13 straight weeks of double-digit year-over-year growth. While there have been fluctuations in weekly data, the overall trend has been positive for the housing market in 2025.
Weekly data for 2025 has shown a mix of positive and negative readings, but the year-over-year data has been consistently strong.
Due to recent events like the holiday weekend and AWS outage, there has been some volatility in the housing market tracker data. It is recommended to interpret the data cautiously and expect stabilization in the coming weeks.
Weekly housing inventory data
Inventory growth has slowed down, but it has been a positive story for housing overall in 2025. Despite some fluctuations, the housing market has shown resilience.
New listings data
New listings data experienced a significant drop recently, which may be attributed to volatility in the market. It is important to consider the context of the data and its impact on housing trends.
Weekly pending sales
Similar to new listings data, weekly pending sales have shown fluctuations. It is important to analyze the data in context and consider its implications for the housing market.
The week ahead: no jobs week, but manufacturing data and Fed speeches
With the current government shutdown affecting data availability, the focus shifts to private data and upcoming Fed speeches. It will be interesting to see the impact of the shutdown on the labor market and how it influences economic trends.