Morning Brief — Tuesday, March 31, 2026

Today's Headlines

Rates

Treasury Rally Pushes 30-Year Mortgage Rate to 6.36% as Iran Deal Deadline Extended

The 10-year Treasury shed 12 basis points today to close at 4.30%, its sharpest single-session drop in three weeks, after the White House announced an extension of the Iran nuclear deal deadline. The reprieve in geopolitical tension is giving bond investors enough cover to buy, and mortgage rates followed suit. The 30-year fixed fell to 6.36%, breaking back below the psychologically significant 6.40% level for the first time since early March. It's the clearest evidence yet that when the Iran pressure eases, rates can reverse meaningfully in a single session.

Economic Data

Consumer Confidence Edges to 91.8 in March, But the Expectations Index Tells a Cautious Story

The Conference Board's March reading came in at 91.8, up 0.8 points from February's 91.0, which is a headline win given the backdrop of $120+ oil and layoff anxiety. The detail that matters more: the Expectations Index dropped to 70.9, below the 80-point threshold historically associated with recession risk. Twelve-month inflation expectations also surged to their highest level since August 2025. Consumers are holding their mood today, but their forward view is increasingly cautious. For housing, the survey flagged a fresh dip in homebuying intentions as the spring season opens.

Housing Market

February Home Price Appreciation Slows to 1.1% Year-Over-Year, Lowest Reading on Record

The American Enterprise Institute's Housing Center released February's preliminary data, showing year-over-year home price appreciation cooled to just 1.1%, the lowest in the entire AEI series history and down from 1.6% in January and 3.1% a year ago. Months' supply climbed to 4.9 months with inventory up 5.6% year-over-year. Prices are softening across all price tiers, not just at the entry level. For buyers, this is actually constructive: sellers are negotiating, concessions are appearing, and affordability is improving at the margins even if it remains stretched at current rate levels.

Market Outlook

Q1 2026 Closes With Rate Relief Emerging and Q2 Forecasts Pointing Lower

Quarter-end bond buying added fuel to today's Treasury rally as institutional investors rebalanced portfolios to close Q1. The 30-year fixed ends the first quarter at 6.36%, still above where most forecasters hoped it would be, but the trajectory into Q2 is improving. All five major housing authorities now project rates to average below 6.38% this quarter and to trend toward the mid- to high-5s by summer, supported by 2-3 expected Fed rate cuts. The combination of slowing home price growth, rising inventory, and a rate path pointing lower is building the foundation for a more active purchase market in the second half of the year.

Non-QM Spotlight

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DSCR Loans: Investor Financing That Works at Today's Rates

DSCR loan rates for qualified investors are running 5.875% to 7.375% in March 2026, with well-qualified borrowers (740+ FICO, 75% LTV) pricing around 6.00% on purchase. As conventional mortgage rates stay elevated and rental demand remains strong, investors are finding DSCR deals that cash-flow at current rates when the right property is underwritten against market rents. This is the moment to be fluent in DSCR math and help your investor clients identify the deals that still pencil.

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Bank Statement Loans: Non-QM's Biggest Volume Driver in 2026

The Non-QM Town Hall hosted by National Mortgage Professional in March confirmed what most active originators already know: bank statement loans remain the single highest-volume product in the non-QM category. Twelve to 24 months of business or personal deposits replace tax returns entirely, giving self-employed borrowers who maximize deductions a path to qualification based on what they actually earn. Non-QM volume is projected to reach $150 billion in 2026, and bank statement programs are a major driver of that growth. If you aren't fluent in this product, you're leaving deals on the table.

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Non-QM Is Now 10-15% of the Mortgage Market and Growing

Non-QM has crossed from niche product to recognized asset class. It now accounts for 10-15% of overall mortgage originations, backed by a decade of strong performance data and growing institutional investor demand. The projected volume for 2026 is $150 billion, nearly double 2025's $80-90 billion. Originators who fully integrate non-QM into their offering are seeing production increases of up to 30% according to recent NMP data. The market shift is real, and the brokers who position themselves as non-QM specialists now are building a durable competitive advantage.

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Non-QM HELOCs: Equity Access Without Touching the First Mortgage

With millions of homeowners sitting on significant equity but locked into low-rate first mortgages from 2020-2022, non-QM HELOC programs offer a compelling solution. Lenders including Angel Oak have expanded second-lien non-QM programs that qualify borrowers using alternative documentation, allowing self-employed and investor borrowers to access equity without disturbing their existing rate. As home prices stabilize and equity positions hold, this product is a growing source of referral business for brokers serving existing homeowner clients.

Nate's Take

Today's 12-basis-point drop in the 10-year Treasury is the first meaningful good news from the rate market in weeks, and it came from a geopolitical development rather than economic data. That's a double-edged signal: the Iran situation has been the primary rate driver since late February, which means the relief we're seeing today can reverse just as fast if negotiations fall apart. Consumer confidence data released this morning supports the same cautious-but-stable read: headline confidence held at 91.8, better than feared given $120 oil and job losses, but the forward-looking Expectations Index is flashing yellow at 70.9.

Here is the part worth focusing on: Q2 starts tomorrow, and the rate outlook has meaningfully improved from where it was 90 days ago. Every major forecaster now sees the 30-year fixed trending toward the high 5s by summer on 2-3 expected Fed cuts. Inventory is rising, home prices are cooling, and sellers are negotiating. For non-QM brokers, the spring season setup is actually solid. The borrowers you help close today at 6.36% could be back at your desk for a refinance in 12-18 months if rates follow the forecast. Start nurturing those relationships now, stay visible this week with the PCE data dropping Thursday, and use every rate-move moment as a reason to reach out.