This article provides an update on the U.S. housing market amidst President Trump's recent actions and executive orders. It highlights forecasted mortgage rates and 10-year yield ranges for 2025 while discussing Trump's potential impact on mortgage rates. The article emphasizes the importance of labor market conditions, noting how recent jobless claims and external factors like wildfires have been overlooked. It also suggests that without improvements in mortgage spreads, the housing market might be experiencing much worse conditions than presently observed, projecting future scenarios based on spread levels.
To make this simple, if mortgage spreads didn't improve from the worst levels of the spreads we saw in 2023, most likely, we would already be losing construction workers and home sales would not have had the recent bounce in sales from record low levels.
For me, the labor market matters most for rates, and the jobless claims data ticked up a bit last week, but between cold weather and the LA wildfires, the market roughly ignored that as well.
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