As we move through the spring market, this week’s market update finds buyers and sellers still showing up, even as economic headlines get louder. Mortgage rates have moved higher in recent weeks, inflation remains a persistent storyline, and the Fed’s path forward is becoming clearer, even if it’s not what many had hoped. For agents, this is a market that rewards preparation, perspective, and proactive client communication.
Economic Trends: A Mixed Picture That Demands a Closer Look
April’s jobs report headline of +115,000 new positions, led heavily by healthcare gains of +54,000—followed a revised +178,000 in March and left the unemployment rate steady at 4.3%. But the details tell a more nuanced story. The household survey, which tracks actual employment differently than the payroll count, showed a decline of 92,000 jobs. The labor force participation rate has slipped to 61.9%, down from 62.5% in January, meaning more Americans are stepping away from the workforce altogether rather than actively searching for work.
Inflation remains the dominant concern. CPI for April came in at 3.8% year-over-year, the highest reading since May 2023, with core inflation at 2.8%. Gas prices surged 28.4% and shelter costs rose 3.3%. Perhaps most notably, real wages have turned negative for the first time in over three years, meaning that after adjusting for inflation, Americans’ purchasing power is declining. The open question is whether price pressures remain concentrated in energy and shelter or begin to spread more broadly through wage demands.
Federal Reserve: Warsh Confirmed, Cuts Priced Out
Kevin Warsh was confirmed as Fed Chair this week, bringing new leadership to the central bank at a consequential moment. Markets have fully priced out any rate cuts in 2026 and are now reflecting a 25% probability of a rate hike before year’s end, a significant shift from the more dovish expectations that opened the year.
Meanwhile, the Fed has quietly transitioned from balance sheet reduction to expansion, now purchasing $40 billion per month in what it refers to as “Reserve Management Purchases” rather than quantitative easing. The distinction is largely semantic: the Fed is injecting liquidity into the financial system at the same time inflation remains well above its 2% target. This tension between loosening financial conditions and stubborn inflation is one of the more important dynamics to watch heading into the second half of the year.
Mortgage Rates: Moving Higher, but Still Better Than Last Year
30-year mortgage rates are currently around 6.5%, the highest level since late March and up approximately half a point from February’s lows. The 10-year Treasury yield has climbed to roughly 4.4%, its highest level since July, applying upward pressure on mortgage pricing. A portion of the rate increase has also come from wider mortgage spreads to Treasuries, reflecting broader market volatility.
The important counterpoint: mortgage rates today remain approximately half a point lower than they were at this same time last year, even though the 10-year Treasury is roughly flat over that period. The MBS-to-Treasury spread has actually tightened by about 0.5%, meaning the mortgage market itself has improved—and buyers are benefiting from that improvement, even if it doesn’t always register in the day-to-day headlines.
Buyer & Seller Impact: Steady Volume in a Constrained Market
Existing home sales for April came in at a 4.03 million annualized pace—up 1% from March and fractionally above April 2025 levels. That figure continues a three-and-a-half-year trend of sales hovering in a narrow band around 4 million, reflecting the tension between buyer demand and the limited inventory that results when existing homeowners hold onto low locked-in rates.
Affordability remains a challenge, with elevated inflation and rates still above the multi-decade lows buyers experienced just a few years ago. But the year-over-year rate improvement offers a genuine tailwind for buyers who are ready to act, and sellers who price strategically continue to find motivated, qualified buyers willing to move.
Agent Insight: Confidence and Context Win This Market
In conversations with buyers and sellers alike, the most valuable thing agents can offer right now is perspective. Rates near 6.5% feel uncomfortable relative to recent memory, but they are meaningfully better than where they stood a year ago, and the spread improvement in the mortgage market reflects real progress that often gets lost in the noise.
With sales volume still constrained near 4 million and no clear catalyst for a dramatic rate drop on the horizon, waiting is not a neutral decision for motivated buyers. Sellers who price right and present well are continuing to attract serious interest. Help your clients see past the headlines and focus on what matters most: their personal timeline, their financial readiness, and the opportunity that exists right now for those willing to act with confidence.