Last year I saw that the housing market was shifting in mid-June and that it would take six to nine months for people to understand what was happening. Sales were about to grow, inventory growth was about to slow down and we had no data whatsoever to even remotely talk about a housing price crash. This was based on the premise, as always with my work, that the housing data tends to improve when mortgage rates get below 6.64% and head toward 6%.
Because housing data was improving last year at this time, it’s going to make for some interesting year-over-year comps for the rest of the year, as rates are higher now. Also, last year, Labor Day weekend was Aug. 30-Sept. 1, so this weekend’s tracker report is heavily impacted by comparisons to the 2025 Labor Day data.
Purchase application data
Purchase application data, which looks out 30-90 days, has shown softness as mortgage rates have risen above 6.64% and stayed there.
When rates were below 6.64%, purchase applications were pretty much positive year over year all year long, building off harder comps at the start of the year too. Now, those comps will be hard to beat, especially with rates near 7% for the rest of 2026.
Last week, the purchase applications index was positive 2% week to week and flat year over year. Not bad given the comps and higher rates, but the next six weeks will be tougher, so keep that in mind.
Here are the stats on purchase apps so far in 2026:
- 14 positive week-to-week prints
- 17 negative week-to-week prints
- 34 flat week-to-week prints
- 10 weeks of double-digit year-over-year growth
- 25 weeks of positive year-over-year growth
- 7 negative year-over-year prints
Weekly pending sales
Our pending home sales data provides a week-to-week perspective, though holidays and short-term fluctuations can affect results. This weekly pending sales data typically takes 30-60 days to be reflected in the sales data.
Now that rates have been above 6.64% for some time, we have seen a slowdown in our pending sales data, but for now it’s shifted from growth to flat to slightly negative.
Here are the pending sales for last week over the last two years:
- 2026: 64,447
- 2025: 65,168
Housing inventory: A big year-over-year comp story now
Housing inventory has had the mildest growth this year versus other recent years. However, most of this was due to two variables:
1. Inventory is no longer working from record-low levels, so it’s harder to get inventory growth as we are getting closer to normal when demand isn’t falling. Existing home sales before rates rose above 6.64% were positive year-to-date.
2. Mortgage rates have had their lowest rate curve for 12 months compared to the past few years, meaning rates haven’t broken over 7% for the first time in a while.
Now that rates have gone above 6.64%, a level that has always slowed housing down, the comps story becomes a big thing for inventory. Last year at this time, mortgage rates were heading lower and demand was picking up, creating much slower inventory growth than earlier in the year when rates were higher. This means inventory data will have an easier time showing year-over-year growth for the rest of the year.
Note: Last year, Labor Day weekend was between Aug. 30-Sept. 1; that explains the one-week dip in inventory last year versus this year, when that dip will happen next week. We saw another week of mild week-over-week inventory growth.
- Weekly inventory change (Aug. 28–Sept. 4): Inventory rose from 879,764 to 883,683
- Same week last year (Aug. 22-Aug. 29): Inventory fell from 860,719 to 846,529
New listings
New listings are in their traditional seasonal decline period. The year-over-year comps are hit here with the holiday data; however, 2026 has still had the healthiest level of new listings post-2022.
Normally, new listings range between 80,000 and 100,000 every week during peak periods. Some context for anyone who believes the new listings data resembles the housing bubble years: during that time, new listings ranged from 250,000 to 400,000 per week for several years.
Here is last week’s new listings data for the past two years:
- 2026: 68,142
- 2025: 64,686
Price-cut percentage
Typically, about one-third of homes see price reductions before they sell, reflecting the housing market’s dynamic nature. Overall, price-cut percentages this year have been lower than last year. Because mortgage rates have risen versus last year, I do expect the year-over-year decline to compress and eventually become on par with, or higher than, last year. We are very close to being on par this week than in previous weeks.
In my 2026 home-price forecast, I called for a national decline of 0.62% for the year. Home-price growth really isn’t going anywhere this year, and my forecast of -0.62% might be hard to achieve, as most home price indexes show price growth between 1% and 2%. However, with rates rising again, I might be right in 2026.
The price-cut percentage for last week:
- 2026: 42.14%
- 2025: 42%
10-year yield and mortgage rates
In the 2026 HousingWire forecast, I anticipated the following ranges:
- Mortgage rates between 5.75% and 6.75%
- The 10-year yield fluctuating between 3.80% and 4.60%
This was a crazy week for the 10-year yield; we had a jobs report that beat estimates, low jobless claims data and escalation headlines in the Iran conflict that pushed WTI oil prices above $93 and still — not too much movement in the 10-year yield or rates this week.
Again, a lot has already been priced in with mortgage rates and the 10-year yield, so to get rates to go much higher, especially with Treasury Secretary Scott Bessent trying to help the long end out starting next week, it will take a more hawkish Fed, hotter inflation data and the conflict getting worse.
It’s inflation week coming up and the Fed has made this week the make-or-break for a possible rate hike in September. Regarding mortgage rates, a few rate hikes are already priced in; this can explain why rates didn’t budge much even after the positive jobs data last Friday.
Mortgage spreads
Mortgage spreads have once again saved the day and kept mortgage rates under 7% for another week. Even with the jobs data beating estimates, spreads have kept rates under 7%. Last week, Editor in Chief Sarah Wheeler and I talked about what could make the spreads worse on this episode of the HousingWire Daily podcast.
Historically, mortgage spreads have ranged from 1.60% to 1.80%. Last week, spreads were at 1.94%, down from 1.96% the week before.
Let’s compare last week’s mortgage rates to where they would have been over the last three years, given the 10-year yield’s current level:
- If we had the worst mortgage spread levels of 2023, mortgage rates would be 8.06% today, not 6.89%.
- If we had the worst levels of 2024, mortgage rates would be 7.68% today.
- If we had the worst levels of 2025, mortgage rates would be 7.49% today.
The week ahead: Iran and inflation week
Let’s keep this very simple: we’ve had more news about the Iran conflict this weekend, so we’ll see what comes out by Tuesday morning. It’s also inflation week, with PPI coming out Thursday and then the big CPI report on Friday. The Fed is putting a lot of weight on this report, but again, on the mortgage side of the equation, a lot has already been priced in, so it needs to be a much hotter report than estimates to move the needle. Also, it depends on where the 10-year yield is trading at. So buckle up for another crazy week.
