The Mortgage Economic Review October 2026 is a Concise Monthly Summary of Key Economic Data and Events during September for Mortgage, Housing, and Finance Professionals.

 

AT A GLANCE – Key Economic Events and Data released during September 2026

• Interest Rates: The 10-year Treasury yield rose to 5.29% (Sep 30) from 4.75% (Aug 31).
• Housing: Existing Home Sales fell 2.0% (-1.2% YoY), New Home Sales rose 6.4% (-2.0% YoY). Home Prices are up about 2.5% YoY.
• Labor: The US Economy created 29,000 new Jobs in September and 133,000 in August. The Unemployment Rate rose to 4.2%, and wages grew 3.0% YoY.
• Inflation: August CPI rose 0.4% (+3.4% YoY), and PCE rose 0.3% (+3.4% YoY).
• The Economy: US GDP grew at a 2.2% annualized rate in 2Q2026, up 2.2% YoY.
• Consumers: Retail Sales rose 1.2% in August (+6.0% YoY), Consumer Confidence and Sentiment fell in September.
• Stock Markets were mixed in September: Dow -4.3%, S&P -0.4%, Nasdaq +1.9%.
• Oil Prices rose to $90/Barrel (Sep 30) from $87/Barrel (Aug 31) from $85/Barrel (Jul 31).

 

Interest Rates and Fed Watch

The latest FOMC meeting wrapped up on Sep 16 with the Fed raising the Fed Funds Rate to a target range of 3.75% – 4.0%. This change is the Fed’s first Interest Rate hike in 3 years. This action was widely anticipated by the markets. The FOMC Committee voted unanimously to raise rates. It was no surprise to anyone – GDP growth is strong, the Labor Market remains robust, Unemployment is low, and Inflation continues to run hot. Consequently, long rates increased significantly: 10 Year Treasuries rose above 5.0%, 30 year Treasuries hit the highest yield in 20 years, and Mortgage Rates breached 7.0%. The rate increase sent a signal to the markets that the Fed is committed to fighting Inflation and will make Monetary decisions independent of political pressure. Fed Chairman Warsh did not disclose plans for future actions. The next FOMC Meeting is October 27th and 28th. Fed Watchers expect no changes to Monetary policy at that meeting.

• 10-Year T-Note Yield rose to 5.29% (Sep 30) from 4.75% (Aug 31).
• 30-Year T-Bond Yield rose to 5.64% (Sep 30) from 5.25% (Aug 31).
• 30-Year Mortgage rose to 7.03% (Sep 24) from 6.66% (Aug 27).
• 15-Year Mortgage rose to 6.42% (Sep 24) from 5.98% (Aug 27).

 

Housing Market Data Released during September 2026

The Housing Market continued its lackluster ways. Existing Home Sales declined 2.0% in August, with year-over-year sales down 1.2%. Data for the New Home Market has been especially volatile over the past 12 months, with wide swings followed by large revisions. Reports from builders show foot traffic is very low. Housing Market Analysts expect Home Sales to limp along for the rest of 2026.

• Existing Home Sales (closed deals in August) fell 2.0% to an annual rate of 3,980,000 homes (3,620,000 SFR + 360,000 Condos), down 1.2% YoY. The median Single Family Home price is $434,800, up 1.6% YoY. The Median Condo price is $371,600, up 1.5% YoY. There are 1,620,000 Existing Homes for Sale, up 5.9% YoY.
• Pending Home Sales Index (signed contracts in August) rose 0.3%, down 4.7% YoY.
• New Home Sales (signed contracts in August) rose 6.4% to a seasonally adjusted annual rate of 684,000 Homes, down 2.0% YoY (679,000 New Homes were sold in 2025, 686,000 in 2024, & 668,000 in 2023). The median New Home price rose 0.4% to $393,700, down 5.8% YoY (Peak $496,800 Oct 2022). The average price fell 9.1% to $478,700, down 8.8% YoY (Peak $568,700 Dec 2022). There are approximately 483,000 New Homes for sale, down 2.0% YoY (Low of 281,000 in Oct 2020).
• Building Permits (issued in August) fell 2.7% to a seasonally adjusted annual rate of 1,394,000 units, up 3.5% YoY. Single-Family Permits fell 1.8% to an annual pace of 878,000 homes, up 1.3% YoY.
• Housing Starts (excavation began in August) fell 2.6% to a seasonally adjusted annual rate of 1,275,000, down 1.2% YoY. Single-Family Starts rose 7.6% to 918,000 units, up 5.2% YoY.
• Housing Completions (completed in August) fell 11.9% to a seasonally adjusted annual rate of 1,128,000 units, down 27.1% YoY. Single-Family Completions fell 10.4% to an annual adjusted rate of 816,000 homes, down 22.9% YoY.
• S&P/Case-Shiller 20 City Home Price Index rose 0.3% in July, up 2.5% YoY.
• FHFA Home Price Index rose 0.3% in July, up 2.5% YoY.
• The NAHB Index fell 8.6% to 32 in September from 35 in August and 34 in July, unchanged  YoY. (High: 90 in Nov 2020).

 

Labor Market Economic Data Released during September 2026

The US Economy created 29,000 new Jobs in September and 133,000 in August. The August Jobs Report was healthy, but September was disappointing. Even though the September Report was below expectations, these numbers point to a healthy Labor Market with over 7,000,000 Job Openings. These last 2 Employment Reports give the Fed more reason to worry about Inflation and less reason to worry about the Labor Market.

• The Economy created 29,000 New Jobs in September and 133,000 in August, but lost 10,000 in July.
• The Unemployment Rate rose to 4.2% in September from 4.1% in August and July.
• The Labor Force Participation Rate rose to 61.8% in September from 61.6% in August and 61.4% in July.
• The Employment-Population Ratio rose to 59.2% in September from 59.1% in August and 58.9% in July, down 0.5% YoY.
• The Average Hourly Wage rose 0.1% in September and 0.3% in August, up 3.0% YoY.
• Job Openings fell to 7,079,000 in August from 7,335,000 in July, and 7,182,000 in June, up 2.3% YoY.

 

Inflation Economic Data Released during September 2026

The latest Inflation data released in September shows that Consumer Prices continued to rise unabated. The CPI rose 0.4% for August. Gasoline led price increases, up 3.9% for the month and 27.4% year over year. PPI was 5.4%, which is a precursor to CPI. That was August Data. September Inflation numbers will probably be worse. With Inflation running this hot, the Fed had no choice but to raise Interest Rates.

• CPI rose 0.4%, up 3.4% YoY    |  Core CPI rose 0.3, up 2.4% YoY
• CPI Shelter Index rose 0.3%, up 3.0% YoY
• CPI Food Index rose 0.1%, up 2.7% YoY
• CPI Energy Index rose 2.1%, up 16.3% YoY
• CPI Gasoline Index rose 3.9%, up 27.4% YoY
• PPI rose 0.4%, up 5.4% YoY    |  Core PPI rose 0.3%, up 4.6% YoY
• PCE rose 0.3%, up 3.4% YoY  |  Core PCE rose 0.2%, up 3.0% YoY

 

GDP Economic Data Released during September 2026

The 3rd and final estimate of 2nd Quarter 2026 GDP indicated the US Economy grew at a 2.2% annual rate, up 2.2% YoY. This is significantly higher than the 1.5% growth from the 1st and 2nd estimates. GDP growth in the 1st Quarter was revised up to 2.5% from 1.6%. The revised increase in growth was attributed to higher Capital Investment, Consumer Spending, and Government Spending. The Industry Groups that contributed most to GDP growth were: Real Estate, Information, Durable Goods Manufacturing, Finance, Insurance, and Wholesale Trade.

• US GDP grew at a 2.2% annual rate in 2Q2026, up 2.2% YoY.
• Durable Goods Orders unchanged in August, up 7.7% YoY.
• Industrial Production unchanged in August, up 1.4% YoY.
• Capacity Utilization was 76.3% in August, unchanged from July.

 

Consumer Economic Data Released during September 2026

Retail Sales jumped 1.2% in August after falling 0.6% in July. Over the last 12 months, Retail Sales are up 6.0%. If Inflation is running at 3.5%, that pegs Real Retail Sales (adjusted for Inflation) at 2.5%. Consumers continued to keep their wallets open in 2026 despite Consumer Confidence and Sentiment hovering at historically low levels.

• Retail Sales rose 1.2% in August, up 6.0% YoY.
• Consumer Confidence Index fell to 81.9 in September from a revised 88.6 in August and 90.2 in July.      
• Consumer Sentiment (UofM) fell 7.0% to 48.1 in September from 51.7 in August and 55.2 in July, down 12.7% YoY.

 

Energy, International, and Things You May Have Missed

• West Texas Intermediate Crude rose to $90/Barrel (Sep 30) from $87/Barrel (Aug 31), $85/Barrel (Jul 31) and $70/Barrel (Jun 30).
• North Sea Brent Crude rose to $97/Barrel (Sep 30) from $91/Barrel (Aug 31), $91/Barrel (Jul 31) and $73/Barrel (Jun 30).
• Gasoline (Wholesale Futures) rose $3.26/Gal (Sep 30) from $3.21/Gal (Aug 31), $3.17/Gal (Jul 31) and $2.90/Gal (Jun 30).
• Natural Gas rose to $2.98/MMBtu (Sep 30) from $2.92/MMBtu (Aug 31), $2.75/MMBtu (Jul 31) and $3.25/MMBtu (Jun 30).
• Oil Prices eclipsed $108/Barrel for Brent Crude before falling back down.
• President Trump met with Chinese President Xi at the White House. At the following State Dinner, both leaders exchanged warm words and compliments but made no commitments.

 

The Mortgage Economic Review is a concise summary of Key Economic Data that influences the Mortgage and Housing Markets. It’s a quick read that keeps busy Professionals updated on important Economic Information. Feel free to share this with colleagues in the Mortgage, Housing, Finance, and Banking business. To have the Mortgage Economic Review emailed to you each month, click here.

 

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Written by Mark Paoletti, a Real Person with No AI, MortgageElements.com,

 

This Economic Review is for informational and educational purposes only and should not be construed as investment, legal, financial, or mortgage advice. The information is gathered from sources believed to be credible and may be opinion-based and editorial in nature. Mortgage Elements Inc does not guarantee or warrant its accuracy or completeness, and there is no guarantee it is without errors. This newsletter is primarily intended for use by Housing and Finance Professionals, but it can be useful for anyone interested in Economics. This newsletter is not an advertisement to extend credit or solicit mortgage originations. © Copyright 2026 Mark Paoletti, Mortgage Elements Inc., All Rights Reserved.