Episode 205: Market Update - Presidential State of the Union

Ready for real movement in housing, not just headlines? We dig into a sharper 2026 outlook where applications climb, rates drift toward 6%, and policy turns the gears on affordability and access. From Wall Street stepping back from single‑family purchases to a fresh wave of mortgage‑backed securities support, we connect the dots between national decisions and what you’ll actually feel in your monthly payment.

We start with the surge in mortgage applications and why a one‑point drop in rates changes everything for first‑time buyers and move‑up owners. Then we unpack the planned $200B in MBS purchases by Fannie Mae and Freddie Mac—what that means for spreads, qualification, and how quickly lower rates can flow to your lock. Next, we take on the proposed ban on institutional investors buying single‑family homes. By curbing bulk acquisitions and build‑to‑rent strategies, more listings can reach families rather than funds, potentially easing bidding pressure and opening real inventory.

Affordability is more than a headline; it’s a path to wealth. We share clear, practical ways lower rates and better inventory can help you build equity faster than most retirement accounts grow in the early years, creating options to renovate, trade up, or diversify. And because the process should be as strong as the outcome, we spotlight a buyer‑friendly win: trigger leads are set to end March 5, cutting off the flood of spam calls after a credit pull and protecting you from impersonation and bait‑and‑switch offers.

If you’ve been waiting for a saner market, this might be your moment to prepare, pre‑approve, and move with confidence. Subscribe, share this with someone planning a purchase or refi, and leave a review with your biggest question about buying or refinancing in 2026—we’ll answer it on a future show.

Transcript

Market Update And SOTU Setup

SPEAKER_01 0:04

Hey everybody, I'm Zach Daniel with Victorian Finance, and welcome back to Constructive Conversations.

SPEAKER_00 0:11

And I'm Dreema Sproudley with Victorian Finance.

SPEAKER_01 0:14

Thanks for joining us today, Dreema. So what we're going to talk about today is just a little market update in 2026. There's been a lot of things in the news that have really affected the market. And you know, coming right off the presidential's uh State of the Union last night, we just want to cover a couple of those topics and really what that's going to look like going into 2026. So Dreamwood, thanks for joining me. Let's talk first about um applications. So you and I kind of looked at that uh earlier. So let's what's that looking like for us?

Applications Rise And Rates Ease

SPEAKER_00 0:54

Yeah, so applications have risen so far in 2026 by 16%, which is um a promising part of what we have to come here in the spring month.

SPEAKER_01 1:07

I agree. I think uh that's good just a good indicator of the spring, and summers are looking uh catapult us this year over last year. Um, you know, uh interest rates are falling. Um, I think year over year, what we've looked at from last year to this year, interest rates are about one percent lower, and that's the lowest levels they've been since COVID, really, right?

SPEAKER_00 1:33

Or since 2022, that's right. So one percent, and that gives um more buying power to um the the consumer purchasing homes currently.

SPEAKER_01 1:45

Yeah, and you know, one of those biggest driving factors um earlier in the year, and I think President Trump really uh re-engaged on it in the State of the Union was he's directed Fannie Mae and Freddie Mack to purchase mortgage-backed securities.

SPEAKER_00 2:03

Yeah, and it's in the um effort to um reduce interest rates, which is promising. So hopefully as we continue on throughout this year, we'll see rates fall even further.

SPEAKER_01 2:16

Yeah, I think um the number I saw was he was going to advise them to purchase $200 billion worth of mortgage-backed securities. Uh, something that I remember reading once before was during COVID, uh we were they directed mortgage-backed securities be bought by the government of $400 billion. So you know, we're looking at right at half of what they were doing during COVID that lowered our interest

MBS Purchases And Rate Outlook

SPEAKER_01 2:49

rates lower than we've ever seen before. So that that's gonna be huge.

SPEAKER_00 2:53

Absolutely. It is it's good to be us for sure.

SPEAKER_01 2:56

Yeah. So um, you know, let's talk a little bit about Americans right now uh and where we stand as far as current homeowners and the interest rates that they hold.

SPEAKER_00 3:10

Uh yeah, so it says 21% of American have Americans have rates of 6% or higher. So I'm expecting um people, you know, as rates fall to be more apt to purchase a home if they're at 6% now. Or, you know, I believe that there may be um refinance opportunities coming here in the near future.

SPEAKER_01 3:40

Yeah. Uh so where are you seeing rates right now?

SPEAKER_00 3:44

So rates um have gone to about six percent.

SPEAKER_01 3:48

Yeah.

SPEAKER_00 3:48

Um, and so and and there's talks of them decreasing further. So six percent is is pretty pretty good.

SPEAKER_01 3:57

Yeah. I remember not that long ago, I was just begging for a six percent interest rate. And that way, you know, I felt like for the people that I was working with, the potential buyers, um, the affordability was an issue, especially for first-time homebuyers. And uh I remember telling people like if we could just get to six percent, like it would be a game changer. And I mean, we're we're here.

SPEAKER_00 4:22

We are, we are. It's um, it's very promising.

SPEAKER_01 4:27

Yeah, I I agree.

Who Holds High Rates And Why It Matters

SPEAKER_01 4:29

Um, one of the biggest things that President Trump talked about in the State of the Union was his executive order for institutional investors to stop purchasing single-family homes. So he was banning and institutional investors, and by that we mean like Wall Street, big company investors. Um tell us a little bit about that, Dreema.

SPEAKER_00 4:51

Yeah, so he is saying, hey, our homes here in America are for Americans. Um, we want Americans to purchase these houses and to have them as their homes, versus you know, these large companies coming in and and buying multiple properties and then renting them. Um it seems to me that you know home ownership for the American people is um is a big focus, especially this year.

SPEAKER_01 5:23

I yeah, and I would agree.

Investor Ban And Inventory Opening

SPEAKER_01 5:25

And when we talk about institutional investors, we're not talking about one-off single investors. Um, so you know, investment properties are still able to be purchased, but it will be long ago is the days of where you have full neighborhoods of houses that are just strictly rental properties, where you know, you'll see some of the big builders. I know we've talked about some of the bigger builders before where they'll build full neighborhoods and then there's just a leasing sign out front, and you go into the model home and just rent a house. That that's gonna be a thing of the past, hopefully.

SPEAKER_00 6:04

Yeah, I hope so. And the the old you know, build-to-rent model where they would build, you know, a section of townhomes or homes, and then they would sell it to the big investors um for rental property.

SPEAKER_01 6:21

Yeah, and uh, you know, that would just open up more inventory for people to buy. I think that with interest rates falling, it's just there's a real focus uh this year on affordability for housing.

SPEAKER_00 6:36

And you know, um it's not only the American dream, but it's also um you're building generational wealth once you purchase that home, and you know, as um the market has done in the past, the um property value increases, and so you have that amount of equity and that amount of equity to put into another home, which then in turn builds.

SPEAKER_01 7:00

Right.

SPEAKER_00 7:00

And so that generational wealth is um is is what's important and building a better you know future for yourself and your family.

SPEAKER_01 7:10

Yeah, because purchasing home uh is an investment for you. I mean,

Affordability And Generational Wealth

SPEAKER_01 7:15

you don't have to be an investor, but when you purchase your home, you're building that equity, you know, faster than your 401k grows. Uh and then being able to utilize that equity to keep increasing and you know, buying a bigger home or uh using equity to invest into other things is just how you really build wealth as a consumer. Um one of the biggest things and something that I am very excited about trigger leads. So, Druma, tell us what a trigger lead is.

SPEAKER_00 7:49

So a trigger lead is um historically when you go and you fill out an application for a mortgage, and we will go in and and pull credit. Um, we do what's called a tri merge. So it's Experian, Equifax, and TransUn. Those particular companies will sell your information, and then all of a sudden you're getting multiple calls um from these um different mortgage companies that are saying, Hey, you know, I can do your mortgage.

SPEAKER_01 8:23

Um but the good news is On March 5th, they have officially announced that the law will take effect where trigger leads will cease. And I'd tell you, I've had clients that after I've ran their credit, they've called me just I rate. They have had up to a hundred calls in the last four hours from all kinds of mortgage companies. And I mean, it it is such a nuisance to somebody wanting to buy a home. I mean, and it's it's a nuisance to us too, because it then is competition where people are trying

Trigger Leads End And Buyer Experience

SPEAKER_01 8:58

to undercut what you've already built uh for your client. But that is taking effect March 5th, where trigger leads will cease to exist. So those calls will stop uh once you apply for a mortgage.

SPEAKER_00 9:12

And what a better buying experience that's gonna provide for for our people.

SPEAKER_01 9:16

I a hundred percent agree, and I mean they're they're sneaky, you know. They'll I've had people say that they've got calls where they have even told the people that they are me or that they work directly with me.

SPEAKER_00 9:29

Absolutely. I have seen the same, and um unfortunately it's just something that's that's taken place, and you can go on the do not call list, but sometimes I don't feel like it's very effective. Um, but now March 5th.

SPEAKER_01 9:45

March 5th, that that goes away, so it will be a better experience, like you said, for home buyers. So overall, I think the State of the Union really focused on you know the American dream, single family homes, lower interest rates, and more affordability for people. So it was all very good news when it comes to housing.

SPEAKER_00 10:07

Yes, absolutely. So um here's to to buying new homes and selling new homes

Key Takeaways And Closing

SPEAKER_00 10:15

and mortgage lending and all the all the great things that we have going for us here, um, and especially in this area with so much coming in.

SPEAKER_01 10:25

Yeah, no, I agree. Well, as far as today goes, that's our market update. So, Dreama, thank you for joining me today.

SPEAKER_00 10:33

Thank you for having me.

SPEAKER_01 10:34

And we'll see you next time on Constructive Conversations. All right.