April 7, 2026 – Nothing Like It

Economic Commentary

The conundrum continues with regard to today’s employment situation. In years past, the current level of job growth would be associated with a concurrent or impending recession. Yet, after last week’s announcement of 178,000 jobs added to the economy in March, we now have 171,000 jobs added for the first quarter of the year, as the previous two months were revised downward by 7,000 jobs.  This follows a year in which only 181,000 jobs were added for the entire year.  Keep in mind that the economy added 2.2 million jobs in 2024, a year of moderate growth.

So why are we not in a recession at the present time?  The unemployment rate moved from 4.4% to 4.3% last month and it is merely 0.3% higher than the beginning of 2025.  Though it has moved upward, the movement has not been indicative of a recessionary economy.  Since we are no longer removing Federal jobs at a robust clip, we can only point to the reduction of legal and illegal immigration as factors which could have caused this phenomenon of tepid jobs growth without a spike in the unemployment rate. There may be other factors in play, but this is the most obvious factor to consider at the present time.

So how will the economy react to this new reality in the long run? Since we have not experienced this relationship before, the reaction of the economy is an open question. Thus far economic growth has been muted as well, which certainly should be expected in the immediate term. Plus, we are experiencing another factor – the conflict in the Middle East which will create at least a short-term rise in inflation. Hopefully these will be temporary factors which will certainly affect the numbers in the next few months. But certainly, these additional factors will make it harder to determine the answer to the “new reality” question.

Weekly Interest Rate Overview

The Markets. The rate increase was less pronounced this past week as hopefully the market is stabilizing somewhat. There is still a lot of volatility from day-to-day. According to the Freddie Mac weekly survey, 30-year fixed rates rose to 6.46% last week from 6.38% the previous week. In addition, 15-year loans increased to 5.77%. A year ago, 30-year fixed rates averaged 6.64%, 0.18% higher than today. Attributed to Freddie Mac: “The 30-year fixed-rate mortgage edged up, averaging 6.46% this week. With spring homebuying season in full swing, aspiring buyers should remember to shop for the best rates.” Note: Rates indicated do not include fees and points and are provided for evidence of trends only. They should not be used for comparison purposes.

Real Estate News

Cotality analyzed why more homebuyers are still opting for adjustable-rate mortgages even as rates begin to drop. ARMs made up 21% of the market in Cotality’s most recent data, the highest share in three years. Despite the falling rates, the savings between conventional mortgages and ARMs are significant, Cotality noted, with a 5/1 ARM in early 2026 at approximately 5.3% and a conventional 30-year loan at around 6.1%. These borrowers are “dating” their interest rate, not marrying it, Cotality stated, with many planning to refinance or sell before the fixed-rate period ends. ARMs are most popular in high-cost markets where the affordability gap is widest. “For many, choosing an ARM is less about preference and more about necessity–a bridge to affordability that comes with the expectation of refinancing or managing higher payments in the future,” said Archana Pradhan, Cotality principal economist. California sees the largest proportion of ARMs, at 31% of mortgage originations in 2025. Washington, D.C., has 28% and Massachusetts is at 24%. And ARMs are particularly popular in luxury markets or high-end sectors. By December 2025, almost half of all originations over $1 million were ARMs.  Source: Cotality

The best way to ease the nation’s housing affordability crisis is for policymakers to eliminate excessive regulations that are preventing builders from increasing the housing supply, the National Association of Home Builders (NAHB) told Congress. Testifying at a congressional panel hearing focusing on housing affordability, Buddy Hughes, chairman of NAHB and a home builder and developer from Lexington, N.C., said that in order to ease housing constraints for home buyers and renters, it is imperative to eliminate excessive regulations that hinder the construction of new homes and apartments. “Regulations account for nearly 25% of the cost of a single-family home and more than 40% of the cost of a typical apartment development,” said Hughes. “The time and costs associated with complying with a multitude of government regulations can be significant for small- and medium-sized builders and ultimately limit housing supply.” Increased regulations, including overly stringent mandatory energy code requirements, are impeding the ability of builders to boost housing production. In particular, Hughes cited a final determination by the Department of Housing and Urban Development (HUD) and the U.S. Department of Agriculture (USDA) that required new single-family and multifamily homes financed by these agencies to comply with the 2021 International Energy Conservation Code (IECC) or ASHRAE 90.1-2019, respectively. The Administration has delayed the effective date for both single-family and multifamily housing until May 2026.  “NAHB urges Congress and the administration to prohibit HUD and USDA from enforcing a minimum energy standard that increases housing costs during a nationwide affordability crisis,” said Hughes. For multifamily projects with federal assistance, a key challenge for builders and developers is the requirement to source domestically for construction. “While our members try to use products made within the U.S., it’s not always practical because of price or availability,” said Hughes. “Multifamily housing needs an exemption from this requirement to help avoid construction delays and additional costs.”   Source: The NAMB

The rising age of first-time homebuyers has dominated discussion of the housing market in recent months—and multiple sources offer varying estimates of how old the typical first-time buyer really is. Last year, the National Association of Realtors® reported, based on survey data, that the median age of first-time buyers had jumped to 40. That is the highest age on record, and up from age 33 just five years earlier. That figure has been widely cited by politicians and is a simple shorthand for capturing the painful affordability struggles that many first-time homebuyers face in the market.  But not everyone agrees with the NAR figure. The Federal Reserve Bank of New York used estimates based on credit reports that showed the age of first-time buyers trending lower over time to 36.3 in 2024, down from just under 38 in 2000. Recently, a separate estimate based on U.S. Census Bureau data was released by Redfin, asserting that the typical first-time buyer was 35 last year—down from 36 in 2024, but up from 34 a decade earlier. The varying estimates highlight the difficulty of precisely pinpointing first-time buyer age, with each of the various methods used in the three studies carrying certain benefits and drawbacks.  “Like a lot of questions that seem simple, the question of who is a first-time homebuyer can get murky,” says Realtor.com® Chief Economist Danielle Hale. “Yes, a family who has never purchased a home before is a first-time homebuyer, but what about the family that owned, then rented for a few years before buying again? In some estimates, this family would be considered a first-time homebuyer.”  Source: Realtor.com