Daily Dose of Real Estate for March 26

The Iran war continues to run the table on mortgage markets. MND’s 30-year fixed hit 6.55% Tuesday — highest since August — before pulling back 7 bps on Wednesday after the U.S. floated a 15-point ceasefire proposal that Iran promptly called unworkable. The 10-year fell to 4.32% but remains 35 bps above pre-war levels, and MBA’s weekly data confirmed the damage: applications down 10.5%, refis down 15%, the 30-year fixed at 6.43% in their survey — a five-month high. Fannie and Freddie are ramping buying MBS under Trump’s $200B directive, and it’s doing roughly what you’d expect a $200B intervention to do in a $9 trillion market – helping on the margins but not as much as we’d like. ICE’s February First Look showed delinquencies ticking up to 3.72%, with the rise in serious delinquencies driven not by new defaults but by a 40%+ collapse in cure rates — a dynamic worth watching if rate volatility persists into spring.

On the policy side, USDA rolled out delegated underwriting authority for its guaranteed loan program, aligning it with FHA and VA — a quiet but operationally meaningful change for rural lenders. HUD opened a Fair Housing Act investigation into Washington State’s Covenant Homeownership Program over ancestry-based eligibility. Zillow Preview (their counter punch to Compass pre-market listings within its own ecosystem) picked up 24 more firms in its first eight days, which is either momentum or a land grab depending on your read. And NAHB’s Eye on Housing flagged what the data already tells anyone paying attention: 47% of owner-occupied homes were built before 1980, the median age is now 42 years, and the remodeling market is the structural beneficiary of a housing stock that’s aging faster than it’s being replaced.

Let’s get you caught up and out the door in 3 minutes. Tim

KEY TAKEAWAYS

• Mortgage rates whipsaw on Iran headlines. MND’s 30-year fixed index closed Tuesday at 6.55% — the highest since August 2025 — before dropping 7 bps to 6.48% on Wednesday as ceasefire talks emerged.
• MBA: Mortgage applications fell 10.5% for the week ending March 20, extending a two-week slide. Refis plunged 15% WoW; purchases dropped 5%. The 30-year fixed rate hit 6.43% in MBA’s survey, a five-month high.
• Fannie Mae and Freddie Mac ramp up MBS purchases amid widened spreads, following Trump’s $200B directive. Analysts call it a “cushion, not a cure” given the scale of the $9T MBS market.
• Treasury yields ease on U.S. 15-point peace proposal to Iran. The 10-year fell to 4.32% from 4.39%, though it remains well above its 3.97% pre-war level.
• S&P 500 rose ~0.5% on ceasefire hopes; oil eased as Iran allowed limited Strait of Hormuz vessel passage. Markets remain volatile with hour-to-hour reversals.
• Zillow Preview adds 24 firms in its first eight days, including Engel & Völkers, BHHS, and Samson Properties.
• HUD opens Fair Housing Act investigation into Washington State’s Covenant Homeownership Program over ancestry-based eligibility criteria.
• Arbor Realty closes $762.6M CRE CLO securitization at 1.73% over Term SOFR, signaling continued structured-finance appetite.
• ICE First Look: February delinquencies edged up to 3.72%; serious delinquency growth driven by 40%+ drop in cure rates, not new defaults. Prepayments rebounded 14% MoM on January refi closings.
• USDA launches Rural Housing Modernization Initiative, granting qualified lenders delegated underwriting authority on guaranteed loans.

RESIDENTIAL REAL ESTATE MARKETS

• Zillow Preview Adds 24 Real Estate Firms Eight Days After Launch. Engel & Völkers, Berkshire Hathaway HomeServices, Leading Real Estate Companies of the World, and Samson Properties among those joining the public pre-marketing product. They join initial signatories Keller Williams, RE/MAX, Side, and United Real Estate. Zillow CEO Jeremy Wacksman said the industry signal is “undeniable.” HousingWire (3/25)
• Cotality: 43.5 Million U.S. Properties Face Moderate-or-Greater Hail Risk. The firm’s 2026 Severe Convective Storm Risk Report pegs reconstruction cost exposure at $17.84 trillion. Hail has emerged as the primary driver of severe convective storm losses, with potential insured losses in extreme scenarios rivaling those of a Category 4 hurricane. HousingWire (3/24)
• Eye on Housing: Almost Half of Owner-Occupied Homes Were Built Before 1980. NAHB analysis of the latest ACS data shows ~47% of the U.S. owner-occupied housing stock dates to 1980 or earlier. The median age of owner-occupied homes climbed to 42 years in 2024, up from 31 in 2005. The share of homes 45+ years old has risen from 39% in 2014 to 47% in 2024, while newer homes (built within 14 years) fell from 18% to 13% over the same period. The aging stock signals a growing remodeling market as older structures require reinvestment. Eye on Housing (3/24)

MORTGAGE MARKETS

• Mortgage News Daily: 30-Year Fixed at 6.48% Wednesday, Down 7 bps After Hitting 6.55% Tuesday on Troop Deployment Headlines. MND noted March has been “an unpleasant month for mortgage rates — a fact almost exclusively due to the Iran war.” Even a ceasefire would not immediately return rates to February levels due to second-round inflation effects from energy disruption. Wednesday’s de-escalation headlines helped, but the market wants “a more ironclad announcement before reacting in a more meaningful way.” Mortgage News Daily (3/25)
• MND Tuesday Newsletter: Rates Hit Highest Since August 2025. U.S. troop deployment headlines at 1pm ET on Tuesday caused lenders to reprice to higher levels, pushing the average top-tier 30-year fixed to 6.55%. Subsequent de-escalation comments helped bonds recover some losses, but rate volatility persists. Mortgage News Daily (3/24)
• MBA: Mortgage Applications Fell 10.5% for Week Ending March 20, Second Consecutive Double-Digit Drop. The Refinance Index dropped 15% WoW (still +52% YoY). The Purchase Index fell 5%. MBA’s survey showed the 30-year fixed at 6.43%, more than 30 bps above end-of-February levels and the highest since October 2025. MBA VP Joel Kan: “The threat of higher-for-longer oil prices continued to keep Treasury yields elevated.”HousingWire (3/25)
• Fannie Mae and Freddie Mac Ramp Up MBS Purchases Amid Widened Spreads. The GSEs are placing sizable bids for agency mortgage-backed securities following Trump’s January directive to buy $200B of MBS. Retained portfolios reached $278B as of January, up from $158B in late 2022. The buying briefly compressed spreads by ~20 bps earlier this year, but rate volatility driven by the Iran conflict has since widened spreads back out. Bloomberg (3/22)
• Analysts Caution GSE Bond Buying Is a “Cushion, Not a Cure.” Morgan Stanley research and Realtor.com’s Joel Berner noted that a $200B program is unlikely to meaningfully alter long-term pricing in a ~$9T MBS market. Commercial banks hold roughly $3T in MBS; the Fed still carries $2T+ on its balance sheet. Spreads have been driven as much by rate volatility and the Iran conflict as by supply-demand technicals. Mortgage Professional America (3/25)
• ICE First Look: February Prepayments Rebounded 14% MoM as January Refi Wave Reached Closing; Serious Delinquencies Rose. The national delinquency rate edged up to 3.72% (+2% MoM, +5.6% YoY), though it remains below pre-pandemic levels. The rise in 90+ day delinquencies is driven primarily by a 40%+ decline in cure rates rather than a spike in new defaults. Foreclosure starts fell 16% MoM to 35,000 but are up 6.5% YoY. Prepayment speeds (SMM) rose to 0.82%, up 80% YoY. ICE’s Andy Walden: “These dynamics bear watching in the coming months, as default activity continues to trend off recent record lows.” Yahoo Finance/BusinessWire (3/25)
• HousingWire: Mortgage Rates Rise as Treasury Yields Hit 8-Month High. MND reported 6.49% for the 30-year fixed on Monday, up 13 bps in a week and 50 bps above when rates bottomed at 5.99% at end of February. HousingWire’s locked-loan data showed 30-year conforming rates at 6.28%. Oil above $100/barrel continues to pressure the bond market. HousingWire (3/24)

REGULATORY & POLICY DEVELOPMENTS

• HUD Opens Fair Housing Act Investigation Into Washington State’s Covenant Homeownership Program.HUD’s Office of Fair Housing and Equal Opportunity notified the Washington State Housing Finance Commission of the probe into the down payment and closing cost assistance program, which includes ancestry-based eligibility criteria. HUD may refer findings to DOJ. The investigation comes days after 16 state AGs filed a lawsuit against HUD alleging the agency is trying to force states to weaken housing discrimination protections. HousingWire (3/24)
• California MBA Testifies on Wildfire Forbearance Bill AB 238. CMBA told the California Assembly Banking & Finance Committee that the bill — which provides up to one year of mortgage forbearance for January 2025 wildfire victims — can provide short-term relief but needs guardrails and a defined path forward. Insurance delays, permitting backlogs, and housing shortages remain key barriers for affected homeowners. HousingWire (3/24)
• USDA Launches Rural Housing Modernization Initiative, Grants Lenders Delegated Underwriting Authority. As part of Trump’s March 13 EO on removing barriers to affordable construction, USDA is upgrading its Single Family Housing Guaranteed and Direct Loan Programs. Qualified lenders can now approve and close guaranteed loans with limited agency involvement, aligning USDA’s process with FHA and VA programs. USDA also launched the My RD Loan Portal for direct loan borrowers. Eligibility standards and funding levels are unchanged. National Mortgage Professional (3/24)

ECONOMIC NEWS

• Treasury Yields Ease on U.S.-Iran Diplomacy; 10-Year Falls to 4.32%. The U.S. delivered a 15-point peace proposal to Iran, driving yields down 1–3 bps across maturities on Wednesday. Iran’s semi-official Fars news agency said an agreement isn’t viable under current conditions, and yields rebounded from session lows. The 10-year remains well above its 3.97% pre-war level. Bloomberg (3/25)
• S&P 500 Rose ~0.5%; Dow Up ~300 Points as Oil Eased on Ceasefire Hopes. Markets continue to swing sharply on Iran headlines, with reversals occurring hour-to-hour. Oil prices fell after Iran said it would allow some limited vessel passage through the Strait of Hormuz. Gold rose 3.4% to ~$4,552/oz after dropping from near $5,400 earlier this month. AP (3/25)
• Economy “Whipsawed” by Iran War and Rising Oil Costs. Mixed signals on Iran peace talks have kept markets in a seesaw pattern. Bond yields have risen and fallen with oil prices, making consumer loan rates more volatile. MBA data showed refinance applications dropping 15% as the 30-year fixed rate hit its highest level since October 2025. U.S. News (3/25)

COMMERCIAL REAL ESTATE MARKETS (INCLUDING MULTIFAMILY)

• Arbor Realty Trust Closes $762.6M CRE CLO Securitization. The deal issued ~$674M of investment-grade notes at a weighted average spread of 1.73% over Term SOFR, with Arbor retaining $88.6M in subordinate interests. The structure includes a ~2.5-year reinvestment period and $100M in capacity to acquire additional loans within 180 days. Collateral is primarily first-lien bridge loans. Notes received investment-grade ratings from Fitch and Kroll. GlobeNewswire (3/23)
• CRE Daily: Fannie/Freddie $200B MBS Push Could Steady Markets — But Not for Long. CRE Daily noted the GSEs’ mortgage bond buying may provide temporary support for agency multifamily and single-family lending spreads, but broader macro forces — particularly Iran-driven rate volatility — continue to dominate CRE financing conditions. CRE Daily (3/24)

INDUSTRY NEWS

• Howard Hanna Settles Tuccori Homebuyer Commission Case. Hanna Holdings, parent of Howard Hanna Real Estate Services, disclosed it reached a settlement agreement via the Tuccori master settlement opt-in feature. Batton plaintiffs continue to challenge the opt-in settlements and coordination of counsel tied to the Tuccori case.HousingWire (3/24)
• Mortgage Rate Volatility Disrupts Spring Pipeline Activity. National Mortgage Professional reported that the primary challenge for originators is not the level of rates but their rapid day-to-day movement, which is freezing borrowers and disrupting deals. GSE intervention may slow rate increases but cannot fully offset broader geopolitical pressures. March typically marks peak homebuying season, but volatility is delaying buyer decisions.National Mortgage Professional (3/25)

Sources: Mortgage News Daily, MBA, ICE Mortgage Technology, HousingWire, Bloomberg, AP, U.S. News, NAHB/Eye on Housing, USDA, GlobeNewswire, CRE Daily, National Mortgage Professional, Mortgage Professional America.