- 4 positive readings
- 3 negative readings
- 3 flat prints
Throughout the year, we have witnessed consistent growth in most of the weekly data for 2025, although starting from a low point. While the growth may not be extraordinary, any progress is a positive sign. The current purchase application data suggests a timeframe of 30 to 90 days, indicating a steady but not robust demand. However, if mortgage rates were to decrease towards 6% and remain stable, it could lead to an optimistic outlook for 2025, potentially increasing sales forecasts, including our current estimate of 4.2 million homes sold.
Weekly pending sales
The most recent weekly pending contract data from Altos provides valuable insights into current housing demand trends. While historically, real growth in housing demand is typically seen when mortgage rates approach 6%, recent data has shown some improvement even with rates above 6.64%. Shortening the duration shows a slight year-over-year growth in pending contracts, which have been slightly negative but improving in recent weeks.
Weekly pending contracts for the last week over the past few years:
- 2025: 346,533
- 2024: 356,618
- 2023: 327,933
10-year yield and mortgage rates
In the 2025 forecast, projected ranges include:
- Mortgage rates between 5.75% and 7.25%
- 10-year yield fluctuating between 3.80% and 4.70%
Recent economic developments, including the Fed meeting and softer data, have brought mortgage rates and 10-year yields to a critical point. Last week, the 10-year yield hovered around 4.25%, with a strong barrier to break below at 4.15% to 4.18%. Moving forward, softer economic indicators, particularly in labor data, may impact the Fed and bond market.
Mortgage spreads
The housing market’s current landscape would be vastly different if not for the improved mortgage spreads seen since 2024. Typically ranging between 1.60% and 1.80%, these spreads have influenced mortgage rates significantly. Looking ahead, a modest decline in mortgage spreads is expected, working off the 2.54% average observed in 2024.
Weekly housing inventory data
As spring arrives, the housing market anticipates a surge in active listings, marking the annual inventory boost. While current inventory levels have not yet reached the desired 2019 levels, progress has been notable. Last week saw a positive increase in inventory.
- Weekly inventory change (March 14-March 21): Inventory rose from 655,626 to 668,155
- The same week last year (March 15-March 22): Inventory rose from 507,160 to 512,759
- The all-time inventory bottom was in 2022 at 240,497
- The inventory peak for 2024 was 739,434
- Active listings for the same week in 2015 were 985,411
New listings data
Although the growth in new listing data slowed recently, 2025 has shown brighter prospects compared to previous years. The aim is to reach seasonal peaks ranging between 80,000 and 110,000 per week, returning to normalcy from the housing bubble crash years.
National new listing data for last week over the past few years:
- 2025: 69,701
- 2024: 60,328
- 2023: 49,993
Price-cut percentage
In an average year, about one-third of homes experience price reductions, reflecting market fluctuations. With inventory levels rising and mortgage rates remaining elevated, the percentage of homes with price cuts has increased. Expectations for modest home price growth of approximately 1.77% for the rest of 2025 indicate a continuation of negative real home-price growth unless mortgage rates decline to around 6%.
The week ahead: Inflation, new home sales, pending home sales, Fed speeches, and more
Anticipate a week filled with significant data releases, including updates on inflation, new home sales, pending home sales, and insights from Federal Reserve speeches. Stay informed about market movements and developments, especially with upcoming jobless claims data and ongoing trade war discussions.
Keep an eye on new home sales and pending home sales data, as well as national home price index reports, for further insights into the housing market. Stay tuned for updates and analysis as the week unfolds!