Ongoing Iran conflict raises mortgage risk into late 2026

HousingWire

On today’s episode, Editor in Chief Sarah Wheeler talks with Lead Analyst Logan Mohtashami about what happens to mortgage rates if the Iran conflict continues past July 4. The two also discuss the latest housing market tracker data.  Related to this episode:  Continued Iran conflict raises mortgage rate risk into late 2026 https://www.housingwire.com/articles/iran-conflict-mortgage-rates/  HousingWire | YouTube⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠⁠ https://www.youtube.com/channel/UCXDD_3y3LvU60vac7eki-6Q  More info about HousingWire https://lnk.bio/housingwire  The Top 5:  Continued Iran conflict raises mortgage rate risk into late 2026 https://www.housingwire.com/articles/iran-conflict-mortgage-rates/  CFPB guidance points mortgage lenders to consider borrower immigration status https://www.housingwire.com/articles/cfpb-immigration-status-guidance/  Housing demand stays positive with mortgage rates near 2026 highs https://www.housingwire.com/articles/housing-demand-positive-as-mortgage-rates-near-2026-highs/  Boston’s international business boom equals more demand for housing https://www.housingwire.com/articles/boston-international-business-boom-housing-demand/  Florida, California counties top ATTOM list of high-risk housing markets https://www.housingwire.com/articles/attom-q1-2026-housing-risk-report-unemployment-foreclosures/  The HousingWire Daily podcast brings the full picture of the most compelling stories in the housing market reported across HousingWire. Each morning, listen to editor in chief Sarah Wheeler talk to leading industry voices and get a deeper look behind the scenes of the top mortgage and real estate.

Transcript

00:09Welcome, everyone. My guest today is lead analyst Logan Motoshami to talk about what

00:14happens to mortgage rates if the Iran conflict actually continues past July 4th, and to discuss

00:20the latest housing market tracker data. First, I'll recap the top trending stories on Housing

00:25Wire. Logan's article on the Iran war implications is trending at the top, followed by CFPB guidance

00:31points mortgage lenders to consider borrowers in immigration status. Then we have the weekly

00:36housing market tracker and two local market stories, one on the booming Boston market and

00:41one on Florida. And we just published a story that I expect is going to jump to the top. And

00:46that is our announcement today that Housing Wire has acquired Keeping Current Matters. I did a whole

00:51separate podcast on that with Clayton Collins that you can check out today as well. Logan,

00:56welcome back to the podcast. It is wonderful to be here. We had another episode of 24 on Sunday,

01:02where I'm what I'm going to do from now on, I'm going to take clips of 24 and then every

01:08headline

01:09we get on the weekend because it's like weekends are for war. And then before the market happens,

01:15somebody has to make an announcement that everything's okay. And we just wait until the

01:19weekend happens and we get these crazy things. The reason I'm bringing this up is yesterday we had

01:26a lot. It was a lot this time, you know, Hezbollah shot at Israel, Israel shot at Hezbollah,

01:34Iran shot at Israel, Israel shot at Iran or was about to shoot Iran. And then Trump came in and

01:38I,

01:38no, no, no, you're not doing this. And then they went, oh, yes, we are. And, you know,

01:45with all that craziness that happened last night, oil prices never got above a hundred.

01:50And I had to bring out fertilizer prices because not a lot of people know that fertilizer prices

01:56have gone back down to pre kind of around pre-conflict era. And people are like, what the

02:02hell's going on? But the article we wrote yesterday is what if I'm wrong? What if this,

02:10you know, I always talk about by the second, after the second week of June is things start to get

02:14dicey. With the Iran conflict, right? Well, yeah, yeah. With the Iran conflict, things get dicey. So

02:20it doesn't make sense for Iran to do this because Trump took away the oil revenue money. And, but what

02:28if they don't care? What if they, I mean, they have had 40 years of sanctions. They go, listen,

02:32we are going to stick it to him and the Republicans. We're just going to wait it out until after

02:37the

02:37midterms. And kind of what, what, what happens in that environment? Because there wasn't much of a

02:44reaction last night. The 10 year yield did get up to, you know, 4.58. And then after the headline

02:51of

02:52today, bond yields went lower and we're, we're about 4.55. So the labor data being firm still

02:59sticks in, but like, what if this is all wrong? What if we just go out for the next six

03:04months?

03:05And what does that mean for housing and the economy and the world economies and everything

03:10in that regard? I really appreciated this yesterday because of course we were communicating about what's

03:15going on and what that might be doing. And the trigger point for you was that last night it was

03:20affecting, you know, oil prices went up by a little bit, but I appreciate it because a couple of weeks

03:25ago, you're like, you know, when it looked like we actually had a ceasefire, I mean, you know,

03:29given our current environment and you're like, you know, what, what does, if the Iran conflict is

03:34over, what does that mean for mortgage rates? So that was great. And again, you've been making

03:39the argument like the longer this goes, the worse it is. And there's incentive on both sides to end

03:44this. So then yesterday you were like, okay, like you said, what if I'm wrong? And, and they're not

03:50going to, even though there are incentives and it seems like a really bad idea on both sides to keep

03:54going. What if that happens? So give us a little preview. What happens if, if this goes on for the

04:00next four or five months? So one of the reasons why I, I don't have this going past July is

04:05that

04:06NATO, if we take their, their, uh, words seriously, NATO said, we can't let this happen past July.

04:12We'll get involved. And Iran's already in financial strain, you know, currency, banking, everything.

04:18But if we go out to this and oil inventory start to fall down and China and everybody like India

04:26came

04:26out and said, we have like, I don't know, 76, 80 days. They gave some, a very, a very limited

04:32timeframe

04:33before they run out. But oil prices just take off like 175, 250, something like that, where

04:43a lot of militaries have to come in and just clear on up short term. That could be very,

04:50very volatile on oil prices. Uh, but for now mortgage rates, the high of the forecast this

04:58year was 6.75 adjusting to where I thought the spreads would get to, but I thought the

05:03spreads would get back to somewhat normal at the end of the year. So we're about 20 basis

05:07points off of that. Um, 10 year yield for 60. We're at 4.55 this morning. So even with the

05:18conflict, even with elevated oil prices, and then the fertilizer prices went up and came

05:22right back down, uh, labor market, uh, rebounding, uh, fed getting hawkish, we're still below 4.60.

05:30Incredible. So for now, because then we, we, we start to get into a lot of hypotheticals about,

05:37you know, elevated oil prices that affect on the economy, you know, consumer spending would

05:42go down and does that change everything? But for now, just like the other article I wrote,

05:48think about 0.375 to 43 basis points higher than what they forecast was. If things get worse,

05:56if things get worse, and then the fed starts saying, Hey, listen, we need multiple rate hikes

06:02because there's not enough damage done in driving cars. I don't know how they change that, but

06:08there's not enough damage done in driving cars or air flights to really impact, you know,

06:13this is the problem of hiking into a war supply situation. Uh, but let's say it goes until past

06:21mid or like December, they Iran waits until then. Um, there are a lot of things that we just cannot

06:29model out on the complexity of having a straighter for moves offline for that much. You can do res,

06:37you know, everyone's throwing their reserves in the, in the play out here, but for now,

06:41just keep that rate variable in there because the spreads are still good. Uh, the fed hasn't gone

06:50into full rate hike mode. Uh, cause I, they don't do just one rate hike. They're going to do multiple

06:56rate hikes. Uh, uh, if the war continues or the conflict continues, goes out, look for them to do

07:02multiple rate hikes. And then at that point we need to see how the spreads react to that. And because

07:10the 10 year yield, the peak was 5%, uh, uh, back in 2023 and in 5%, they were crying uncle

07:19at that point. Now the jobs data is lower. Like if I take a 12 month average of jobs, it's

07:2642,000,

07:27right? If it's 92,000 for six months. So it's not like you have a booming economy to say,

07:34let's just hike into this. So it becomes, uh, something that we have to track day in and day

07:39out, but, but it's something maybe we need to think about because even though it seems like the market

07:45is preparing for a deal and you can see how adamant Trump was, Hey, everyone stop fighting,

07:50stop shooting missiles. You know, stop it. We got to make a deal. You know, um, what if Iran just

07:57says, Hey, listen, we're just, we've, we've been 40 years of sanctions. We can last another five

08:00months. I think it's much more difficult because the world economies aren't gonna, you know, you know,

08:05and, uh, the last thing they need is NATO coming in and us. And then, you know, whoever's in charge,

08:11they're just risks, uh, getting, getting, uh, uh, obliterated, but it is something to think

08:18about if we start to, if this goes past July, that, that was under nobody's circumstance. And that just

08:24means elevated rates the entire year, right. Until the economic data starts to get really weak.

08:33Uh, and then we just have to take off the daily news. Cause at that point, you know,

08:37there's going to be whatever crazy headlines we deal with now, it's going to get much worse going

08:41out in the future out there. So it's just something to keep that, that article and all

08:46those charts and everything was to keep in line with what the forecast was, but also what's the

08:52possibility that I'm wrong. And this goes all the way to November and December and the world

08:57implication, the world economies, even China is doing its best and import less and using the reserve.

09:04I mean, there's a lot of players in this miss, uh, in this mix to, uh, uh, go in there.

09:10So it's,

09:11it's a, it's a lot of hypotheticals, but, uh, until we get something signed and have ships flowing,

09:17ships have to flow. Um, uh, you know, let's be, let's be a little bit mindful that this doesn't

09:25end in a very quick fashion. Like, like, you know, the markets might be getting ready to price for.

09:29This has been what you have been focused on the whole time. It's like, no matter what is said or

09:33done, it's how much oil is getting through the straight that really, that really matters.

09:37And that's where we're, we're still not seeing, you know, a lot of progress there. So

09:41interesting. I appreciated you doing it. It's also super complicated because as you were,

09:45you were talking about, you know, or you're talking about oil prices, you're talking about

09:48then the fed reaction to that, you're talking about the, you know, inflation and fed rate hikes

09:54and unemployment. And, you know, what does this mean in the mix? And then you just think,

09:59I think the most amazing thing we've said it before is that this is happening in a midterm year.

10:04Like, like that is not normal political behavior, whatever you think of it. It's just like,

10:10normally you just want things to be, you know, uh, pretty calm before you have a bunch of elections.

10:14Um, not the case this year. It's all caution thrown to the wind.

10:18So whenever people ask about, you know, midterm elections and oil and, uh, Trump does something

10:25that he says, well, I thought oil would be at 200. I thought oil would be at 300. No,

10:30they, they, they did not think this. Why? Because the whole thing was all be done four to six weeks,

10:36four to six weeks. That's it. You know, nobody had, oh my God, Iran's going to shoot missiles at

10:42their neighbors and they're going to start, stop, you know, straight up for moves. That was never

10:47part of the plan. So I believe Trump just thought he was going to go in and probably the situation

10:53with Venezuela made him a little bit more cocky than normal. And I was going to go blow up a

10:59few

11:00things, kill a few people and then leave. And then, you know, that's it. Obviously that didn't happen.

11:05Um, so I, it's, it's, it's tricky, right? I mean, as the analyst, you're supposed to like,

11:13you know, try to model like the worst case scenario, best case scenario, but I think people

11:17are just confused. Right. I mean, I had to do a whole Instagram video on fertilizer prices,

11:21because that's what a lot of people are talking about. And I don't even know how that relates to

11:25anything. Well, it's because everyone, everyone keeps on talking fertilizer prices, diesel prices,

11:30all these things. And all of a sudden the thing is back to pre conflict levels. And I was like,

11:34why isn't anyone talking about this? Well, it's better to talk about doom. Oh, by the way,

11:39speaking of which we, we converted a lifetime doomer to, to, to, to, to back to planet earth.

11:45You did. Good work. Yes, we did. And he just, he just, he just felt like, God,

11:50they just say the same thing every day or every year. I said, really? I, after 12 years,

11:56you just figured that one out. Hello, McFly. So I have a new catchphrase, you know, you know,

12:03you can listen to a jackass or you can learn from a badass. It's your choice. Right. But if the

12:11people

12:12are doing the same thing day in and day out for like every year, they're doing it for a reason,

12:16because they don't believe in it. They just want to suck you in. Oh yes. Doom. You know,

12:23pick your, pick your fighter people. Come on your fighter or, you know, pick whatever ass you want,

12:28but if you want a jackass or a badass, there you go. Um, you know, in any case, it's just,

12:37I think it's, it's complicated. This is not, we're not used to like in a midterm election,

12:42somebody doing this. So, uh, we're working in new paradigms, but I understand the confusion of last

12:48night and this morning, but just kind of think of it. Weekends are for war and during market hours

12:54are for peace. My, the, the absolute respect for market hours by people, you know, doing these

13:00decisions is, is, is, is unbelievable. Like we're not going to do anything crazy during market hours,

13:05but when it's Friday, Friday night, Saturday, uh, go out and everyone not there. So. Okay. Given all

13:11that craziness on the weekend, what did the housing market tracker show this weekend? Except that

13:16demand is still positive. This is crazy. It is. But first of all, the one thing is that

13:24somebody I know, you know, last two weeks ago said, Oh, uh, sales fell new listings, data fell,

13:31you know, uh, uh, uh, the, the war is I say, homie, how many times do we need to say

13:36this?

13:36It gets impacted by weekend holidays. Okay. So inventory does fall. New listings does fall and sales fall

13:44happens all the time for years. You cannot say this after this. So, cause then the rebound effect,

13:52you know, that you're going to get is going to be like, Oh, what happened? What changed in the last

13:56seven days that changed your premise after we get, I mean, this is why I always have, we don't write

14:01the tracker the last two weeks of the year because people just don't realize people don't look and buy

14:06homes during Christmas and new years, especially if it's on a Wednesday for both weeks. Those two weeks

14:11are completely off the ground. It's like COVID. So we got the rebound in new listings. We got the

14:16rebound in active inventory. Inventory is still down year over year, just a smidge.

14:20Uh, um, but the weekly demand is still above last year, even above the last two years. And I think

14:28some people are shocked because they see the increase in rates, but just remember mortgage rates are still

14:32lower this year than last year. Uh, so we've always said housing tends to act better when mortgage

14:38rates get below 6.64 and head towards six. So we've lost that 6.64 head to, but it's 2026.

14:46The last two years, you know, wages have outgrown home prices. It's another year of household

14:52formation, right? You know, so, you know, millions of people buy homes every day. So it's a slight

14:57increase in demand, even with rates going off the highs. Now, for me, it's a little bit different

15:02because the forecast was we can get 237,000 more existing home sales in 2026. If mortgage rates to

15:09stay six and a quarter and under, we had that before the conflict, even if there was no conflict,

15:15I don't believe rates would have been under six and a quarter if inflation, you know, was still firm

15:19and the labor data picked up. However, with that said, still shocking to a lot of people, uh, by the

15:25time this podcast comes out, existing home sales are going to come out tomorrow morning. So don't expect

15:29too much craziness out there. But if you just take a step back and you didn't know anything,

15:36what was happening around the world and the economy, and you looked at the housing data and

15:40aggregate and total and everything, you're like, not much is happening. That's crazy.

15:45It is literally one of the most boring years, but within that boring year, there's a ton of stuff

15:52happening within the data. Like I have to keep on explaining every week why Florida's inventory data

15:58look is like down year over year noticeably and still right. But they were working from an elevated

16:05level and they have some issues there in Florida that are different than others. Uh, uh, so just

16:09remember the supply and demand equilibrium. If it worked in Florida and next year, hypothetically,

16:16let's just say rates go back down to 6%. Please, please do not do that. Oh my God. Sellers are

16:23going to

16:23come in and inventory is going to skyrocket and home prices are going to be down 38 to 50%.

16:29We debated somebody that actually wanted to say that. That's unbelievable. But now you can learn,

16:35right? You can, the whole tracker was designed to teach. And if I teach and you learn, then

16:41everyone, you can teach everyone how this works. And again, housing wire intelligence, all of you

16:45podcast 20 for a discount code. You can go to your own area, right? My job is to teach the

16:51economics of

16:52housing. You could go to your area in Ohio. You could go into Florida. You could go into San Francisco,

16:58Seattle, anywhere you'll have access to it. And now you know how the pending sales and new listings

17:03and 10 year yields and how the spreads work. Sarah Wheeler, do you like the spreads this year?

17:10Absolutely. No. What do you always say? You're like, hug a mortgage spread.

17:13Hug a mortgage spread, kiss a mortgage spread, take it. Cause

17:18every, every single year in the last three years, mortgage rates would have been well above seven.

17:24So that's the, that's the saving grace. And that was the whole trying to teach people spreads. I

17:28need the spreads to get down. And every single year we're like, okay, we should improve this

17:32much is to prove this much. And, you know, to me, it's like, we could get to 180, how we

17:36track it

17:37toward the end of the year. We're at 2% or a little bit above two. So hug a mortgage

17:41spread,

17:42because be a little bit different if that wasn't getting close to normal.

17:46Last week, the day, the data, it was officially June data. I know we had, you know, a snapback

17:52effect because of the holiday, but what do you think about seasonality looking at where we are

17:57now? We're in June. Normally you look at, you know, from, from the second week of January through

18:02May, what do you think about seasonality right now? So it's funny. Cause you know, looking back at

18:06the data last year in 2025, you know, for me, I was like, I could see things were about to

18:10change,

18:11you know, because rates are about to go down and the growth rate of inventory was already slowing

18:14down and just can't sustain itself. Just remember that our weekly data is very seasonal. We're at

18:21the, we've already kind of hit the seasonal peak of the sales data and we start trending down soon.

18:26The new listings data will start trending lower out here. And that's just how housing works.

18:33But this doesn't mean you can't have higher existing home sales in the winter, right? This is always the

18:39trick. In the last 15 years, our best yearly existing home sales tends to happen in winter.

18:46A lot of that is because rates go lower and it takes some time to hit into the sales data.

18:51Just

18:51kind of always remember the days on market is growing. So things take longer. So sometimes the

18:59sales that might've happened very quickly during COVID because, you know, things were moving a little

19:04faster. Things take a little bit longer to close out. So always kind of factor that in,

19:11but all of you that see the tracker, you can visually see how seasonal things are.

19:15And we're starting that we've already kind of hit that peak area. And then in a few months,

19:20it's easily the downtrend. So we'll keep an eye on active inventory, the low bar comps

19:25that we had because it's next week is mid June. What happened in mid June last year?

19:31The whole housing market shifted. It wasn't like home sales were booming, but the growth rate of

19:37inventory could not simply sustain itself. And now that we're one year here, inventory is down year

19:44over year. Even places like Florida is even down notice. Well, there are places in the country where

19:48it's increased. Sales are just probably a little bit higher than last year. And we'll just take it one

19:54week at a time, but we have a framework now, 2023, 2024, 2025, and 20, give you a framework of

20:01how

20:01things operate. And now all of you are now experts and you don't need to listen to that jackass

20:08on the internet who has been basically lying for 12 through 13 straight years. You could be a badass

20:14yourself and teach everybody, you know, like the chart daddy does. And then knowledge is power,

20:20right? Education is a gift. And when people read books, instead of burning them, Sarah Wheeler,

20:26oh, it's always a good thing. It is a good thing. Logan, thank you as always for all the analysis,

20:31all the work over the weekend. Appreciate you.

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