U.S. Housing Outlook — October 2025

Rates ease, builders hold, investors position for the next move.

At-a-Glance
30-yr Fixed 6.30 % · 15-yr 5.53 % · Median Home $422.6 k · Supply 4.6 mo.
Sources: Freddie Mac · Census.gov · Case-Shiller · NAR

Macro Pulse

• Rates: 30-yr 6.30 %, 15-yr 5.53 → Freddie Mac PMMS

• Sales: Existing homes 4.00 M SAAR (Aug) · Median $422 600 · 4.6 mo supply → NAR Data

• Prices: Case-Shiller +1.7 % YoY (Jul) → S&P Global Release

• Building: Starts 1.307 M · Permits 1.312 M · Completions 1.608 M → Census Release

• Supply: DOM rising; ≈ 20 % of listings cut price → Realtor Research

📈 Investor read: Prices plateau, rates slide — a window opens ahead of 2026.

California — LA Metro

• Sales 264 240 SAAR (+0.9 % m/m) → CAR Report

• Case-Shiller LA 440.0 (flat m/m) → FRED Data

• 2026 Forecast: modest gains as affordability improves → CAR Market Data

🎯 Play: Negotiate seller credits and builder rate buy-downs before spring inventory release.

Washington D.C. Metro

• Case-Shiller 331.1 (down from spring peak) → FRED

• Median $670 k · DOM 44 · Listings 2 626 → GCAAR Report (PDF)

• Closings ↑ 6.2 % YoY → Bright MLS Release

🧭 Play: More inventory = better negotiation leverage and 2-1 buy-down opportunities.

Buy vs Build Snapshot

30-Day Catalysts

• Oct 17: Housing Starts (Sep) → Census.gov

• Oct 23: Existing Home Sales (Sep) → NAR

• Oct 28: Case-Shiller (Aug) → S&P Global

• Weekly: PMMS → Freddie Mac

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Micro Lens – UWM & Housing Market Transmission

(Source: UWM Market Updates + CEO Mat Ishbia commentary)

1. Rates Drifting Down, Demand Drifting Up
30-yr ≈ 6.30 %, down from 7 %. Refi apps +10–15 % MoM; builders see renewed traffic. UWM expects a “mini refi boom” as rates stabilize below 6.25 %. “Consumers are back shopping when rates start with a 5.”

2. Purchase Volume Flat, Capture Rising
Industry purchase volume –8 % YoY; UWM broker channel share > 51 %. AI-based pricing and Purchase → Refi → Repeat cycle drive file retention.

3. Loan Mix Shifting
Conventional One-Time Close and DSCR loans rising; FHA/VA steady. Temporary buy-downs (1-0, 2-1) expand. Processors must track TRID timing & COC accuracy.

4. Builder & Construction Lending Tightening Slightly
Regional banks pull back; non-bank UWM partners fill gap via warehouse lines. Builders offer mortgage credits vs price cuts. Custom builds stabilize Q1 2026.

5. Operational Focus – Efficiency & Automation
AI underwriting cuts turn times 25 %. Processor training shift → Encompass + Blend integration. Margin stability through volume and automation.

6. Borrower Behavior
Buyers pause > 6.5 %, return < 6.25 %. Refi wave expected H1 2026 (+40 % YoY if ≤ 5.75 %).

Innovation + Productivity Macro Themes

1️⃣ Rolling Recession → Rolling Recovery
Employment slows while productivity rises +2.3 % YoY (BLS Productivity).
AI and automation propel a transition from recession to productivity-led growth.

2️⃣ Fiscal Acceleration & Corporate Re-Engineering
Full first-year expensing for manufacturing and equipment (IRS Notice 2025-12) drops effective tax rates toward 10 %.
Surging FDI (BEA Release) stimulates housing near new industrial zones.

3️⃣ Deflation Through Technology
Industrial robots –50 % per doubling; AI training –75 % / yr (ARK Big Ideas 2025).
Cheaper tech means lower CPI and downward rate pressure.

4️⃣ Labor & Automation Dynamics
Private jobs –32 k (ADP); openings fall (BLS JOLTS).
Corporations protect margins via automation (FactSet Earnings Insight).

5️⃣ Productivity Boom → Housing Revival
Real GDP ≈ 5 % (Fed GDP Nowcast); rate cuts and re-shoring ignite construction lending and housing supply growth.

🔍 Key Insight

Innovation is deflationary, not inflationary — lower input costs and AI efficiency extend the housing and refi window into 2026.

🏗 Action Plan

1. Track FDI zones for housing demand.

2. Model 2026 cash flows at 5.5–6 % rates.

3. Use construction-to-perm and bridge loans to front-run the cycle.

4. Prepare for refi volume surge Q2 2026.

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Author

Irakli Ezugbaia — Managing Member, Wexmoor Circle LLC
📇 CA DRE #02271654 · NMLS #2728634 · NAMP-CMP
Broker of the Record: Pacific Prestige Properties, Inc (NMLS #1132725 | DRE #01900872)

With expertise in real estate investments and mortgage origination, Irakli specializes in construction financing, owner-builder projects, and FHA/Conventional loan programs.

An Equal Housing Opportunity Lender.

Disclaimer: This article is for informational purposes only and does not constitute financial, legal, or tax advice. Loan programs and eligibility vary by lender and location. Always confirm requirements with an FHA-approved lender or mortgage broker.