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Steiner: "Housing Hates Stagflation" Mortgage rates have retraced half the drop they took during the Iran war, and Hedgeye Housing Sector Head Josh Steiner @HedgeyeFIG says that tailwind is now completely gone. The 30-year fixed rate mortgage started 2025 near 7% and had fallen to 6% in the week before the Iran war kicked off. The latest Freddie Mac Primary Mortgage Market Survey print landed at 6.51%, unwinding half the move. "Any tailwind that may have been there from the mortgage rate side is completely gone," Steiner explained. Our positioning reflects the shift. We remain short US Home Construction $ITB and Steiner has layered on two single-name shorts in the space, Zillow $Z and Rocket Mortgage $RKT , the latter added just this week. The bigger call ties back to the Quads. "Housing hates stagflation. It's by far the worst environment. It's much worse than quad four," Steiner said, noting that the problem with stagflation is that growth is weakening and the Fed cannot respond because of the pressure on inflation. Backtest any housing stock and it looks its worst, by far, in Quad 3. The average quarterly return for Rocket Mortgage in Quad 3 is -28%. With hints of a Quad 3 shift taking place, the setup turns brutal from here for the housing sector. To learn more about our GIP Model on which the Quads are build on, visit our Process Guide: https:// app.hedgeye.com/education#iii- macro-strategy-the-gip-model-and-quads … Subscribe to The Call @ Hedgeye for insights you won't get anywhere else: https:// insights.hedgeye.com/the-call/