Rates, Confidence, And The 2026 Housing Outlook

Benchmark Happenings

Mortgage headlines are loud, but the real story is quieter: confidence. We dig into why builder confidence is rising while buyer confidence stalls, how the Fed’s long “sugar high” of quantitative easing set us up for today’s rates, and what a softer jobs market—amplified by AI hiring freezes—means for mortgages over the next 6 to 12 months. No fluff, just a grounded look at the forces moving your payment and your plan.
Steve Reed joins us to unpack the data behind rate direction, explain why 3 percent mortgages aren’t coming back, and outline a realistic path from the mid-sixes toward the mid-fives if inflation keeps cooling. We talk through first-time buyer pain points—student loans, income thresholds, PMI—and the practical levers that still work: zero-down USDA where eligible, state assistance, smarter down payments to avoid PMI, and credit optimization that moves the needle. The message isn’t “buy now at all costs.” It’s build a strategy that fits your rent, your reserves, and your timeline, then move with confidence.
We also examine the government shutdown’s ripple effects on lending. In flood zones, stalled federal insurance snarls closings; elsewhere, FHA, VA, and USDA pipelines can slow even as well-capitalized lenders keep funding. The broader risk is timing and trust. In markets like Northeast Tennessee where inventory is tight and in-migration is strong, prices are unlikely to roll over even if rates ease—so waiting for both cheaper money and cheaper homes may be a myth. Looking to 2026, we see cautious optimism: steadier rates, more inventory, and better affordability at the margins.
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To help you to navigate the home buying and mortgage process, Jonathan & Steve are currently licensed in Tennessee, Florida, Georgia, South Carolina, and Virginia, contact us today at 423-491-5405 or visit www.jonathanandsteve.com.

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1. Welcome And Local Market Framing (00:00:00)

2. Confidence Check: Builders Vs Buyers (00:01:01)

3. Will Rates Ever Be 3% Again (00:04:56)

4. First-Time Buyers And Affordability Reality (00:08:09)

5. Strategy Over “Push Button, Get Loan” (00:12:18)

6. Inflation, Jobs, And The Fed’s Hangover (00:15:58)

7. AI, Hiring Freezes, And Rate Direction (00:19:47)

8. How Many Cuts And How Low Could Rates Go (00:21:49)

9. Buy Now Or Wait: It Depends (00:24:58)

10. Government Shutdown: What’s Breaking And Where (00:28:19)