Slow and steady Fed approach could boost homebuyer prospects, says DFW broker
The Federal Reserve announced a wholly unsurprising interest rate hold on Wednesday afternoon – a decision the mortgage industry had been counting on, and one that some believe could set the stage for a more stable second half of the year.
This week’s announcement marked the central bank’s first decision under new chair Kevin Warsh, with financial markets and mortgage professionals alike seeing next to no chance that the Fed would either cut or hike its benchmark rate.
While some mortgage market watchers have called for sweeping cuts in the months ahead to stir market activity, Dallas-Fort Worth broker Hunter Bolling (pictured top) of HB Mortgage Team told Mortgage Professional America a predictable and calm approach to rates could also ultimately boost homebuyer prospects.
That’s especially the case because encouraging news on the US-Iran war this week suggests a permanent ceasefire could be imminent, potentially easing some of the turbulence that’s clouded the economy since that conflict broke out in late February.
“I want [the Fed] to go slow and steady,” Bolling said. “I think that’s what we haven’t had over the last several years, where it’s just been kind of up and down.
“For us right now, it’s so nice to be slow and steady, to let the market move and let us really react to what’s going on and not have those fluctuating markets where it’s affecting everyone in a very short amount of time.”
What the Iran ceasefire means for mortgage professionals
Data released by the Mortgage Bankers Association (MBA) on Wednesday morning showed the average contract rate for 30-year fixed-rate mortgages staying unchanged at 6.60% last week, weighing on overall mortgage application volume.
But better news on the Iran war, which has spiked Treasury yields in recent weeks, could eventually put downward pressure on those rates and ease borrower concerns about a further climb in rates.
“It’s not even just from the consumer standpoint. I honestly believe from the professional standpoint on our end, [the framework peace deal] just brings a little bit of anxiety down,” Bolling said.
“You never knew what was going to happen over each weekend, and it just eases a little bit of pressure off an already difficult situation where rates were elevated and you were trying to make things work and then trying to react to war headlines and CPI all in the same week. So it’s a great foundation that’s now been laid.”
Still, while news of an agreement is a positive step, plenty remains to be done before consumer confidence can improve meaningfully again. For Bolling, that could be a lengthier process than some might think, particularly because oil prices still need to post a substantial decline to return to their pre-war level.
“I want to see these oil prices and other things become a little bit less costly. Starting at the gas pump is a huge way for Americans to determine what their next moves are,” he said.
“And if we could get those gas prices down and get people to want to be back in the market and spending money, that’s going to be a great place to start. I think housing is going to see a reaction shortly after.”
Oil prices could unlock housing demand before rate cuts
For now, rates below 6% appear a distant prospect, even if the 30-year average briefly slid into the fives earlier this year. Most mortgage professionals expect rates to hover in a range between 6% and 7% from now until the end of the year – although the Fed’s decisions for the rest of 2026, which will strongly influence but not directly move mortgage rates, could have a big say in that question.
The confirmation of Warsh to replace Jerome Powell as chair has stirred some optimism that the Fed might move more strongly towards preferring rate cuts. Bolling has seen few clients mention the new Fed chair yet by name – but sees Warsh as a positive choice for the mortgage industry and market.
“I want to be positive because I think there’s been so much negativity over the market over the last four years,” he said. “I really want to see things change and I want to see our consumers win. So I’m excited about that.”
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