"Mohtashami noted that nominal home price declines nationally are historically rare, stating that excluding the 2007-2011 period, the U.S. has never had a year where home prices fell even 1% nationally."
"He emphasized that the key missing ingredient in 2026 is distressed sellers, explaining that during the housing bubble crash, new listings ranged from 250,000 to 400,000 per week, which is significantly higher than modern totals."
"Mohtashami argued that even if mortgage rates cross 7%, a crash would not follow, as there have been rates between 6% and 8% for three years without distressed sellers."
"He pointed out that mortgage spreads remain a positive story for housing in 2026, with last week's spreads closing at 2.11%, indicating a stable market despite potential worst-case scenarios."
Housing demand is at its highest in years, driven by low mortgage rates. Purchase application growth has slowed recently, but remains positive year-over-year. Historically, nominal home price declines are rare, especially without distressed sellers. During past housing crashes, new listings were significantly higher than current levels. Even with rising mortgage rates, a market crash is unlikely without distressed sellers. Mortgage spreads are favorable for housing, currently at 2.11%, indicating a stable market outlook for 2026 despite potential geopolitical risks.
Read at www.housingwire.com
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