What real estate agents need to know about the spring housing market

Jason Waugh — president of Coldwell Banker Affiliates — said employment data remains one of the most important indicators for housing activity because it reflects household confidence and purchasing power.

“The jobs report is, in many ways, a housing report in disguise,” he said. “Employment trends ultimately determine consumers’ ability and willingness to buy or sell homes. February payrolls fell by 92,000 and unemployment rose to 4.4%, which on their own could help ease some of the pressure that’s driven rates higher over the past week.

“However, today’s rate volatility is being influenced more by energy markets than employment data. Periods of heightened global uncertainty can push mortgage rates in directions that may feel counterintuitive to consumers. Markets aren’t reacting solely to economic growth; they’re reacting to whether higher energy costs will keep inflation firm and keep the path of interest rates higher for longer.”

Even so, economists say the housing industry should be cautious about interpreting any single jobs report as a signal of long-term market direction.

Sam Williamson — senior economist at First American Financial — said monthly labor market figures often contain short-term noise and revisions that can distort the broader economic picture.

“Month-to-month swings in employment data can move markets in the short run, but they are inherently noisy and frequently revised,” he said. “More importantly, mortgage rates are influenced less by any single jobs number and more by movements in the 10-year Treasury yield, which reflects broader financial conditions — particularly inflation expectations and the market’s view of the monetary policy outlook.

“For that reason, real estate and mortgage professionals should keep client conversations focused on broader labor market dynamics alongside the inflation and mortgage rate environment, rather than placing too much weight on individual jobs reports.”

Energy prices and global risk

Beyond employment, geopolitical developments including widespread military action in the Middle East continues to shake markets — with plenty of ensuing consequences for interest rates and other housing cogs.

Rising oil prices tied to global tensions have introduced new uncertainty for investors and homebuyers alike.

Waugh said the key issue for financial markets is whether energy price spikes prove temporary or signal longer-term supply disruptions.

“If investors believe the conflict could cause sustained supply disruption, Treasury yields may rise, and mortgage rates often follow,” he said. “The key question now is whether markets view this as a brief disruption or a sustained shift that keeps oil prices and bond yields elevated. If it’s sustained, mortgage rates could re-enter the kind of volatility that has characterized the past few years, slowing progress on reducing the lock-in effect.”

Williamson emphasized that geopolitical shocks often cause short bursts of financial market volatility but don’t necessarily lead to sustained increases in borrowing costs.

“Geopolitical developments can introduce short-term volatility into energy prices and financial markets, which can briefly push Treasury yields and mortgage rates higher,” he said. “In most cases, however, these effects fade as the initial shock passes and do not translate into sustained upward pressure on interest rates.

“Energy prices become a more durable driver only if they remain elevated long enough to lift broader inflation expectations and keep longer-term yields higher. Absent that persistence, mortgage rates continue to be shaped by the broader constellation of forces influencing longer-term yields.”

Consumer uncertainty

While economists track macroeconomic indicators such as Treasury yields and energy markets, homebuyers and sellers obviously focus more on personal financial situations.

Lisa Sturtevant — chief economist at Bright MLS — said uncertainty surrounding jobs, inflation and global conflict is affecting consumer sentiment in the housing market.

“It is clear that there is a lot of uncertainty in the economy,” she said. “Labor market conditions appear to be weakening. The conflict in Iran is putting upward pressure on oil prices, raising new concerns about inflation. While prospective buyers and sellers watch the economic news, most think more about their own personal situations and ask themselves questions, ‘Is my job secure?’ ‘Will my family have to cut back on expenses?’ ‘Is this a good time for us to buy a new home?’

“During this uncertain market, real estate and mortgage professionals can demonstrate their value by being attuned to their clients’ economic concerns rather than focusing solely on external factors like energy prices.”

That shift in consumer mindset means housing decisions may hinge as much on household confidence as on interest rate movement moving into the Spring housing market.

CNBC reported Monday that the Bank of England (BoE) will not move forward with a planned interest rate cut this month —with the institution citing military conflict as a factor.

“BoE cuts are possible in the first half of 2026, but March is off the table and April requires a clear calming of geopolitical tensions,” Allan Monks, chief U.K. economist at JPMorgan, told CNBC. “For now we delay the next cut to April, but the risks are already shifting towards a lengthier pause and larger growth impact.”

Inflation and mortgage outlook

Williamson said modest increases in unemployment alone won’t necessarily lead to significantly lower borrowing costs.

“A modest rise in unemployment, on its own, is unlikely to materially change the mortgage-rate outlook over the next 6 to 12 months,” he said. “Rates would be more likely to move meaningfully lower only if labor-market conditions deteriorate sharply enough to signal a broader economic downturn, prompting a sustained flight to safety into Treasuries and a shift in policy expectations.”

Absent that, inflation risks are likely to keep longer-term yields elevated, maintaining a higher floor under mortgage rates, he said.

“As a result, affordability is more likely to improve gradually — through income growth and slower home price appreciation — rather than through a sharp decline in borrowing costs,” said Williamson.

A delayed and uneven spring market

The Spring housing market — typically the busiest time of year for home sales — may unfold more slowly this year as buyers and sellers wait for greater clarity.

Sturtevant said vague expectations for interest rates and the broader economy has led many households to pause major housing decisions.

“Both buyers and sellers are holding back amidst this uncertainty,” she said. “They are waiting not just for rates to fall, but also for more stability in the mortgage market. As we head deeper into March, we are likely to see a delayed spring housing market as buyers and sellers remain in a bit of a holding pattern.”

Even so, the Spring housing market is unlikely to move uniformly across the country. Local economic conditions will still play a major role in determining how quickly activity rebounds, Sturtevant said.

“Good metrics to watch to gauge a local market’s is headed include early buyer interest like home views and showing activity as well as listing activity,” she said. “The extent to which sellers drop their asking prices, or take their homes off the market when they don’t get the price they want, can also be an indicator of where prices are headed in a local market.”

Waugh said the current environment requires guidance that remains vigilant of broader action but puts more emphasis on local and personal economic realities.

“This dynamic also contributes to a split spring market: some buyers re-engage on any rate window, while others remain cautious due to uncertainty around job stability and future monthly payments,” he said. “For mortgage and real estate professionals, this is a moment for steady, localized guidance.

“Stay grounded in what’s happening with employers in your community, help clients define their budget comfort zone, and take a proactive approach with rate-lock strategies and timing. Preparation and clarity will position clients to act confidently.”

For professionals across the housing sphere and their clients alike, navigating the current status quo will require patience, careful planning and close attention to both national and global economic signals — as well what’s going on outside their windows.

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