- 6/14/2025
On today’s episode, Editor in Chief Sarah Wheeler talks with Lead Analyst Logan Mohtashami about economic factors that could affect the housing market, including Israel’s war with Iran, oil prices, bond yields and tariff deals.
Related to this episode:
Tariffs | HousingWire
https://www.housingwire.com/tag/tariffs/
HousingWire | YouTube
https://www.youtube.com/channel/UCXDD_3y3LvU60vac7eki-6Q
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 stories. Hosted and produced by the HousingWire Content Studio.
Related to this episode:
Tariffs | HousingWire
https://www.housingwire.com/tag/tariffs/
HousingWire | YouTube
https://www.youtube.com/channel/UCXDD_3y3LvU60vac7eki-6Q
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 stories. Hosted and produced by the HousingWire Content Studio.
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NewsTranscript
00:00Welcome, everyone. My guest today is lead analyst Logan Motoshami to talk about war,
00:10oil prices, bond yields, tariff deals, and other variables that could affect the housing market.
00:16Logan, welcome back to the podcast, and you're wearing a cowboy hat.
00:21You know, ma'am, we are going to Billy Bob's.
00:25Yes, we are.
00:27Yes, U.S. Bank is having an event.
00:31Yes, U.S. Bank. Back to Logan here.
00:35Yes, we'll be speaking at the U.S. Bank event in Texas this week, so I've got my cowboy gear out.
00:42Whenever I come to Texas, a cowboy gear comes out.
00:44Okay, let us not forget that you rode a horse in, like, athletic shorts and, like, sandals or something.
00:50Yeah, I had shorts and a T-shirt, had sunglasses, and that was the first time I rode a horse since I was, like, eight, I think, so.
01:01Okay, well, we're going to have to work on this so that when you show up to Billy Bob's, you're not, you know, you look right.
01:06So, okay, well, exciting about that, but lots of really interesting and serious things happening in the market.
01:13Of course, we've had an escalation.
01:15There's Israel has attacked Iran, and the question is, you know, what does that variable, that global variable mean for the housing market?
01:24Okay, so this is Friday morning.
01:29This is a very fluid situation.
01:31A lot can happen by the time this podcast comes out, but usually what I like to do is, you know, I go to Instagram stories, and we talk about, like, what the market reaction is, because that's for housing.
01:44What traditionally happens, usually you get, like, a flight to safety.
01:48Money goes into the bond market.
01:49Money goes into the dollar.
01:51Oil prices spike up.
01:52That's what we saw last night, except the move to the dollar was very, very timid, and the 10-year yield fell a few basis points, but, you know, as of Friday morning, I think we're at 438, 437, not much, not much of a reaction into it, which is interesting because this is not just a mild attack.
02:13This is a very, very big attack, and, of course, oil prices really, I think, at one point, were well above 10% last night.
02:21It's come down a little bit today.
02:25So, to me, we always get a rush of people that say, you know, is World War III going to start everything?
02:32No.
02:33These are, it's very difficult in this day and age to have World War III with the global economies, right?
02:39This is, I mean, it took Europe and Japan to rebuild from World War II, and too many countries have too many things invested in to have, like, a really big war.
02:50But, usually, people think, well, oil prices are going to go up, that's bad for inflation, and, you know, I just want to remind everybody, back in the last decade, oil prices were high for a very long time, many years, until the oil shell boom happened.
03:11And the growth rate of inflation was very tame, right?
03:15So, people have to remember, don't put everything into the higher oil prices, and headline inflation will just spiral out of control.
03:25Because we had higher oil prices, and it didn't filter into the other inputs.
03:30This has always been, like, an argument.
03:32How much does oil price really filter it?
03:35I know the White House, one of the reasons they wanted oil prices to fall is they believe if oil prices fall, everything else will fall.
03:42And that's really based on the price that diesel, if diesel prices fall, then food prices won't grow as fast or have some disinflation.
03:50Questionable on that premise, but in any case, as long as escalation doesn't occur, and you get more regional, you know, something like that, this should be a very mild short-term event, like the others have been in the past.
04:07But it is noticeable that the dollar really didn't get much of a kick, a very, very small move higher from last night's lows to where we are this morning.
04:17The 10-year yield, very yawning event, actually.
04:21But oil prices did increase.
04:24Compare this to when Russia invaded Ukraine as a variable that affected the 10-year yield and therefore mortgage rates.
04:33Well, when Russia invaded Ukraine, oil shot up to over $120.
04:38Wheat prices took off.
04:41Wheat prices taking off is not a good thing.
04:44And if you look at a chart, by the way, yeah, if you look at a chart of wheat prices, you guys are really going to do that.
04:50And oil prices, you can see the Russian-Ukraine impact on those things.
04:56So we are off a lot from those levels.
05:00So we don't see any kind of super spike like that.
05:04And again, you know, adjusting to inflation, like oil prices have to get like $450 to match what we saw in the late 70s to pair their constant dollars right now.
05:15So obviously it's not that because it's a regional where wheat was a factor in the Ukraine invasion.
05:24So for now, you know, short-term, we'll see what happens over the weekend.
05:29By the time this comes out, who knows?
05:31We just don't know.
05:32I mean, we just don't know over the weekend.
05:34This is why we come on Mondays now and do podcasts for that.
05:39But it's one of these things you can understand how a lot of people would ask questions.
05:44And again, if anything like that happens, you guys all go to my Instagram.
05:48You guys have probably seen I Have No Life.
05:51I'll be showing oil charts, dollar charts, you know, what's going on every hour to the hour.
05:56And if this gets contained and it's just, you know, gets done in a very short amount of time, the impacts will be very minimal short-term.
06:07So we're about halfway through the year, shifting focus here from that event.
06:12We're about halfway through the year.
06:14What are your thoughts on the housing market halfway through 2025?
06:18Now, of course, I'm very biased.
06:20I'm very happy because inventory is, you know, getting toward the 2019 levels.
06:26And again, for me, this always goes back to, you know, February of 2021.
06:30The housing market cannot function normally with inventory levels this low.
06:34This is a very, very historically abnormal period of time.
06:38And just imagine, just imagine if mortgage rates never got above 5%.
06:43Would we have had the inventory growth, right, in active listings?
06:48Obviously, now the mortgage rate lockdown people, not you, Sarah Wheeler, right?
06:53But people who said that inventory cannot grow with higher rates because nobody's going to sell their home.
06:58That's not the case.
06:59Inventory has been able to grow in this environment.
07:03And we are perfectly fine.
07:05If mortgage rates went down to 6%, nobody should be worried.
07:07Even if it goes down to 5.5%, there's not going to be what we saw in, you know, 2020, 2021, in the early part of 2022.
07:15We are so far from those levels.
07:17So I remember when Mike Simonson and myself talked for the first time in a podcast.
07:22And, you know, I told him, I believe inventory can get to 2019 levels, but it needs weakness in demand.
07:30And, you know, inventory can build.
07:32This is not, we're not at a very normal state.
07:35So if new listings grows, weakness in demand, inventory can just move itself back up to normal.
07:41And now we have, you know, home prices aren't escalating out of control.
07:44It is a more healthy market.
07:46And then, of course, purchase application data is positive, even with elevator rates.
07:51Another thing that makes me smile because, you know, if you look back in other housing cycles, this is actually very normal.
07:58When rates do fall, you can now see demand just picks up because sales are just depressed.
08:02So good in that aspect.
08:04I know this is a different view than a lot of people, but I always believe in the balance, right?
08:12The supply and demand equilibrium, the balance.
08:13We lost that.
08:15So when everyone was happy because home sales were up, booming, prices were up, that was an unhealthy market to me.
08:21This is a much more healthier backdrop.
08:24And, again, if rates fall, we're in a much better spot to handle that.
08:29I'm not worried about home prices escalating out of control ever again, you know, with rates up here and inventory higher.
08:36So I've seen several things this week talking about how the investor share of home buying is down.
08:43Something that you always point out, you know, it's not like they own all the homes anyway.
08:47But, you know, that is something that people have worried about over the last few years.
08:52So what are we seeing this week?
08:53What does the data tell us?
08:55You know, if you look at the NAR's percentage of sales to investors for the last few years, it hasn't really budged much.
09:06I mean, much at all.
09:09I think what this is.
09:11This is my opinion on this.
09:12People have lied so much about investors' percentage, especially when it comes to Wall Street.
09:20And think about the irony that 100 years from now, we will look back and see all these people that said BlackRock was buying all the homes, and they bought zero homes, and Blackstone owns zero.
09:31I mean, it is literally embarrassing that we have functioning adults that, past the second grade, basically cannot read a sentence.
09:40And Wall Street's percentage went from 2.5% to like 0.4% quarterly.
09:48So investors, as you can imagine, if you're investing and trying to flip something or anything in that regards, this is not the most easiest environment, especially with elevated rates, costs, carryover costs.
10:02What are you going to do in that?
10:03You're going to have to be a real professional at this point.
10:06So naturally, the investor percentage with some people's data lines has fallen down.
10:12And again, inventory still not anywhere close to the five-decade average.
10:20The NAR looking at $2 to $2.5 million.
10:22We're at $1.45.
10:23We're going to get to the bottom end of 2019.
10:26This is the fourth calendar year of sales being this low.
10:30Much different credit market, so much different inventory market out there.
10:34It was funny because, you know, the doomers have gone on the Redfin chart so much.
10:43And then I always go, okay, so you have a 9% decline forecast.
10:48You have a 12%.
10:49You guys are using Redfin.
10:50Then why is Redfin's home prices still up year over year?
10:56Zilch.
10:57Nothing.
10:57I said, okay, you guys said this is the biggest seller, you know, market in history.
11:03So why is Redfin's home price index higher?
11:06It's like three weeks in a row now.
11:08What's going on?
11:10Nothing.
11:11Zilch.
11:12Right?
11:13So the inventory getting back to normal positive.
11:16Right?
11:16Supply rising positive.
11:18Doomers who are talking about...
11:20We have people who've literally forecasted three straight years of noticeable nominal declines
11:25already off by 20, 25%.
11:28And the data line they're using is actually still showing year over year growth.
11:32Nothing.
11:33Right?
11:33So investors falling as a percentage, you could absolutely be very normal in this environment.
11:39But as you could see, the scale that this was going to be like the mass increase in supply
11:45or vertical supply of some people said, that was 2005 to 2007.
11:50That supply and demand equilibrium made sense, right?
11:53Existing home sales were peaked in 2005.
11:55It crashed.
11:57It took a few years to get down and inventory escalated up to 4 million.
12:01I mean, think about where we are.
12:02The NAR's inventory data was at 4 million in 2007.
12:06We're at 1.45.
12:07Today, fourth year, fourth calendar year, right?
12:11So things are different.
12:12And we always say, always follow people that have forecasted for at least five years.
12:17Go back and read their forecast.
12:19Read their models if they have any.
12:21They don't have any.
12:22Trust me.
12:23And then you could start to make sense of the supply and demand equilibrium of housing
12:27out there.
12:28And by today, Monday, hopefully new listings data picked up again.
12:33Hopefully, I'm not talking about Monday.
12:37New listings data took another solve.
12:40We want to see things get back to normal.
12:43And this is how a functioning market works.
12:47But the investor side was always an overhype story.
12:50And then you have politicians who basically lied to their constituents that Wall Street is
12:55buying all the homes.
12:56It's a joke, right?
12:56If anything, single family rental supply is actually supplied to help rents have disinflation
13:04factors, not inflationary factors out there.
13:07So the whole thing, the whole last three, four years have been embarrassing to watch, right?
13:12It's just not very...
13:14I mean, I can understand why the Russians would do it.
13:15I can understand why the Chinese and Iranians would do it.
13:18But to have American politicians basically lie that Wall Street was buying all the homes
13:22and investors, you know, no.
13:24If you're going to blame anyone, blame the biggest home buyers in America for the last
13:27few years, you know, and that was millennials, right?
13:30Without millennials, you know, you wouldn't...
13:32We've done that.
13:33We showed people, right?
13:3470% to 80% of home sellers are buyers.
13:37Who's the biggest buyer in America over the last 10, 12 years?
13:40It was millennials.
13:41They don't give you a house.
13:42That's our inventory.
13:43So there's just a lot.
13:46There's been a lot of bad housing takes.
13:48I thought the investor one was just more of a grift, either by politicians or
13:52YouTube Doomer accounts.
13:55Okay.
13:55So of course, we, amid everything else that's going on, we still have, talk about tariffs,
14:01tariff deals, tariff uncertainty.
14:03Where are we with that, Logan, as far as how that affects housing?
14:07Well, I think today Japan came out and says, we're not going to do anything until we get,
14:13you know, all tariffs removed.
14:14So again, we don't have like 90 deals in 90 days, of course.
14:19But I think what happened was, and somebody asked a good question.
14:24Somebody was talking about inflation is going to really take off and it's, you know, middle
14:29of June right now.
14:30We haven't seen any data.
14:31So I have to, let me, let me explain this on how tariffs kind of work.
14:37Let's say LoganMotorshami.com.
14:39I sell chart daddy shirts, right?
14:42And I get all my shirts from China, but because of tariffs, everyone bought a ton of chart
14:49daddy shirts and the inventory was already here.
14:52I have a massive amount of inventory and now the tariffs are put on.
14:56Well, I have a lot of inventory that I need to draw down.
14:59I don't have to charge higher for this.
15:02But once this inventory is gone, then the ships are coming now, then the tariffs come
15:07in and then you could increase some of the prices.
15:09So some products are seeing increases already out there.
15:15You know, I'm keeping an eye on natural gas prices.
15:19That doesn't look very healthy to me.
15:21But when you get more stuff being, you know, imported in with the tariff percentage, you get
15:27more revenue really from tariff tax collection, then you start to have more and more products
15:34into the system.
15:36So I think the people that are surprised that inflation data hasn't taken off on some things,
15:43just remember that there's still a lot of inventory that's in-house already because there
15:49was so much purchasing.
15:49That was one of the reasons why the GDP was so crazy in the first quarter.
15:54So over time, it starts to look different, especially, you know, especially for companies
15:59and how they deal with it.
16:01It is interesting that the continuing claims data that we saw on Thursday morning, that's
16:07at a three-year high now.
16:09And again, continuing claims is, you know, people filing for unemployment benefits but have
16:13been out unemployed for a longer timeframe.
16:16That looks at a three-year high where initial claims is starting to perk up, slowly starting
16:23to move up.
16:24So we're keeping an eye on that because if that trend continues, right, because now there's
16:30arguments being made that, you know, the labor market is softening more than, you know,
16:35inflation going up.
16:36The Fed is behind the curve.
16:37So the next Fed meeting is going to be interesting due to their language change.
16:41But I can understand the confusion with tariffs.
16:44Just remember, it's a process.
16:46It's not like you could just tariff something if there's inventory here already.
16:50And, you know, the shipments, you know, there's all these things that go into that equation.
16:55And I think a lot of people are just surprised that the inflation data has been as tame as
16:59it is.
17:00But if you look at it in that construct, hopefully that makes a little bit more sense.
17:03It does make more sense.
17:05Logan, thank you so much for being on, talking through all these different things that are
17:09going on that could affect the housing market.
17:11Jack Bauer.
17:13Jack Bauer.
17:14What did I say?
17:15Hey, I've got my, I put my Jack Bauer glasses on.
17:18I went on, I went on Instagram.
17:20It's time to look at dollar oil and bond yield charts.
17:24Here we go.
17:25Chloe, give it to me now.
17:27Get the charts up, Chloe.
17:28Come on, you know.
17:30So.
17:31I can still hear that, the, the 20, the 24 phone thing.
17:35You know what I mean?
17:36Like when, when a phone call was coming into that.
17:38I'm telling you, even Chloe, the, the, the actress, when, when I saw her at a community,
17:43you know, she was making fun of my hair.
17:45She's like, well, you got, you got too good of hair to be in this, uh, in this room with
17:48these gentlemen.
17:49So it always, it always falls back to the hair at some point, you know, it really does.
17:55Every conversation.
17:56All right.
17:57Um, thank you so much.
17:58Uh, we will talk to you again very soon.
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