Current market turmoil may be the new normal, says analyst

Chaos could become permanent fixture in this political climate, leading to long-lasting impacts

Current market turmoil may be the new normal, says analyst

The current economic turmoil is making mortgage customers hesitate before entering the housing and mortgage markets – and one analyst worries that if the political climate remains unchanged, the current turmoil could become the new normal.

Rich Martin (pictured top) is the director of real estate lending solutions at Curinos, a global data intelligence business that helps banks and fintechs leverage analytics. He is concerned that the temporary effects of tariff-driven uncertainty could become a more permanent condition.

“We live in a new normal,” Martin told Mortgage Professional America. “The main question to me is whether this is all temporary or becomes a more permanent fixture of this political climate, and in turn economic climate. This undoubtedly would have a longer-lasting impact and broader change globally in terms of trade and commerce, affecting more than just real estate.”

It has been nearly a month since the Trump administration announced its “Liberation Day” tariffs, which have been changed, reduced, and added to since the original announcement. Some states are pushing back, suing the administration over the tariffs.

While Trump’s initial April 2 announcement in the Rose Garden pushed financial markets into a deep decline, Martin believes the back-and-forth that has followed hasn’t helped.

“The current political situation in DC is creating market volatility, particularly in the bond market, which is how mortgage rates and other lending products are priced,” Martin said. “Markets trade on expectations, and when those expectations change daily or weekly based on trade negotiations and less on macroeconomic factors, those expectations become unclear.

“A general lack of confidence proliferates, and fear becomes the new normal and expectation.”

Curinos numbers confirmed MBA reporting

Like the Mortgage Bankers Association (MBA), Curinos also collects mortgage application data. Martin notes their numbers echo what the MBA has reported.

“Per our proprietary data, we saw a 14% decrease week-over-week in terms of mortgage applications, with rate and term refinances down most significantly at almost 41%,” Martin said.

Martin said the drop is more dramatic when compared with statistics going back to February.

“If you trend back into February of this year, you can see the more recent trends represent a broader decrease in demand, both for refinance and purchase transactions,” he said. “It’s largely a result of mortgage rates rising due to the market volatility and economic uncertainty around both economic policy and monetary policy, and the Fed holding steady on rates.”

The rising rates also show up in the company’s rate lock indices. Across all loans, rate locks decreased 21.1% week over week. For rate and term loans, that drop was 47.5%

“Actual rate lock commitments from borrowers have decreased in four of the last six weeks,” Martin said.

In rate and term loans, decreases have occurred in five of the last six weeks. The lone bright spot was the week of April 6, when mortgage rates dipped for a brief period. That week, rate locks increased by 137.6%.

Like other reporting agencies, Curinos sees a continued increase in home values, with increases week over week for the last four weeks in a row. The year-over-year increase last week was 4.2%. While the values have increased, they have gone up by less than 10% in each of the last five weeks, year over year, showing a slight steadying in home values.

“In terms of home price appreciation, the majority of markets are still appreciating, albeit now at more normalized levels than what we saw the last decade or so,” Martin said. “However, that said, we are seeing some signs of depreciation in Texas and Florida markets.”

Not a crisis… yet

Despite the negative news, Martin believes there are opportunities available for homebuyers and refinancers. He encourages brokers to take advantage of local opportunities to find the right options for their customers who still want to move forward with new loans.

“Rates always tend to go up faster than they go down, so in terms of buyers, we are seeing some inventory relief,” Martin said. “If you can find a property you like, take action now, there’s always ability to refinance later down the road.”

He believes that there will be opportunities to refinance loans over the next two years, as he thinks rates will be lower in 2026 and 2027.

Martin said that while tracking rates is important, there are other factors to consider which could decide whether things begin to rebound, or if the turmoil causes bigger issues ahead.

“While rates are important, it’s good to stay close to other structural factors such as inventory, consumer confidence and debt levels,” he said. “There’s definitely a housing shortage and a broader affordability problem right now. I won’t call it a crisis just yet, but it has the potential to become that. Just look at this week’s home sales report. Rates are playing a role, but not the singular cause of decreased demand.”

Stay updated with the freshest mortgage news. Get exclusive interviews, breaking news, and industry events in your inbox, and always be the first to know by subscribing to our FREE daily newsletter.