CHM Blog

Why isn't the spring housing market springing?

Spring is supposed to be the season when the housing market shakes off winter and gets moving. This year, however, it’s taking its sweet time. Real Estate News’ Dave Gallagher reports that, according to Freddie Mac, the 30-year fixed-rate mortgage is down slightly and notably lower than a year ago. On paper, that should be good news for buyers sitting on the fence.

The modest dip came partly on hopes that a U.S.-Iran ceasefire agreement reached in early April might reduce instability in the region and ease pressure on energy prices. But Mortgage News Daily Chief Operating Officer Matthew Graham was measured in his assessment, noting that it "will take a material change in the status of the war and a clear response in energy prices to catch the bond market's attention." Translation: don’t hold your breath.

For now, the spring homebuying season is sputtering. Redfin estimates that pending sales fell 4.1% year-over-year for the four-week period ending April 12. Home-touring activity tells an equally flat story. While the number of people looking at homes is up 11% compared to the start of the year, that same stretch in 2025 saw a 40% jump. The enthusiasm just isn't there.

Redfin economics research head Chen Zhao put it plainly: the lack of response to lower mortgage rates lines up with a slowdown in the labor market and increasingly sour consumer sentiment. People may be watching rates. They are just not acting on them.

The Mortgage Bankers Association reported that overall mortgage applications did inch up 1.8% for the week ending April 10 — but dig into the numbers and the picture gets complicated. That uptick was driven almost entirely by refinance applications. The unadjusted purchase index was actually down 3% compared to the same period last year. Joel Kan, MBA's vice president and deputy chief economist, summed it up: "Purchase activity remained subdued as potential homebuyers remained hesitant given the current economic uncertainty."

There are a few silver linings in the mix. Home prices are mostly flat, and First American's March Home Price Index showed that home appreciation dropped 0.4% year-over-year. Chief economist Mark Fleming noted that monthly price appreciation is picking up modest momentum heading into spring — but also cautioned that strong regional differences remain. Midwest and Northeast markets are still seeing solid annual gains, while much of the South and West is still trailing year-ago levels.

Bright MLS’ Lisa Sturtevant expects mortgage rates to stay volatile as inflation remains elevated. For buyers who are ready to move, the window may be open — just not wide enough yet to feel like an invitation.

RealEstateNews, TBWS

How Rates Move:

Conventional and Government (FHA and VA) lenders set their rates based on the pricing of Mortgage-Backed Securities (MBS) which are traded in real time, all day in the bond market. This means rates or loan fees (mortgage pricing) moves throughout the day, being affected by a variety of economic or political events. When MBS pricing goes up, mortgage rates or pricing generally goes down. When they fall, mortgage pricing goes up. Tracking these securities real-time is critical. For more information about the rate market, contact me directly. I'm among few mortgage professionals who have access to live trading screens during market hours.

Rates Currently Trending: Neutral

Mortgage rates are moving sideways today. The MBS market improved by +27 bps last week. This may have been enough to decrease mortgage rates or fees. The market experienced high volatility last week.

This Week's Rate Forecast: Neutral

These are the three things that have the greatest ability to impact rates. 1) Geopolitical, 2) Retail Sales and 3) Jobs.

1) Geopolitical: This category will continue to dominate all financial markets this week, particularly the bond market as the ever-changing Iran story versus Oil Prices has been the main driver of long bond yields for over a month.

2) Retail Sales: The headline number is expected to jump simply due to higher prices. The bond market will focus on the details.

3) Jobs: We have a very light week for economic data (other than Retail Sales). The high-frequency ADP and Initial Weekly data points will get plenty of attention.

Treasury Auction: We have an important 20 Year Bond auction on Wednesday.

This Week's Potential Volatility: High

This morning markets are mostly moving sideways. Volatility has started at moderate to low levels but could spike at any time depending on geopolitical developments.

Bottom Line:

If you are looking for the risks and benefits of locking your interest rate in today or floating your loan rate, contact your mortgage professional to discuss it with them.

Richard Sardella has been actively managing and providing services in the mortgage industry for over 30 years. Richard serves on the board of directors as President of Colorado Home Mortgages Inc.

All information furnished has been forwarded to you and is provided by thetbwsgroup only for informational purposes. Forecasting shall be considered as events which may be expected but not guaranteed. Neither the forwarding party and/or company nor thetbwsgroup assume any responsibility to any person who relies on information or forecasting contained in this report and disclaims all liability in respect to decisions or actions, or lack thereof based on any or all of the contents of this report.

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