Gallagher Re has issued its Mortgage Market Report for Q3 2025. The release highlights major economic drivers relevant to mortgages, along with CRT performance and an origination quality index derived from Freddie Mac’s ACIS and STACR programs. The following summarizes the facts presented.
Economic conditions
The latest indicators point to a stable environment. Gross Domestic Product declined 0.1% for the quarter and 0.5% year over year. The unemployment rate held at 4.1%. Personal income per capita continued to rise, reaching a record high of $74.5K per household. The labor force participation rate edged down to 62.3% (–0.1%), a level consistent with the 2015–2018 period. As volatility tied to tariff policy subsides, the bond market is pricing in two 25-basis-point rate cuts in 2025, while Federal Reserve commentary remains data dependent with a wait-and-see stance. Ten-year Treasury yields and mortgage rates are currently 50 basis points below recent highs.
Securitization and CRT activity
Quarterly GSE securitization volumes are near 10-year lows. Freddie Mac’s market share remains above 50%. The estimated CRT-eligible share of new securitizations is near the all-time high of 80%.
Home price movement
National home prices declined 0.7% in the latest quarter but rose 2.2% year over year. On an annual basis, 45 of 51 states (including Washington, D.C.) reported appreciation. The range spans from –4.2% in D.C. to 7.4% in New York. The strongest growth is concentrated along the East Coast, particularly in the Northeast.
Report scope
The report covers major economic mortgage drivers, CRT performance, and an origination quality index, with both derived from Freddie Mac’s ACIS and STACR programs.
Key figures at a glance
• GDP: –0.1% quarter over quarter; –0.5% year over year
• Unemployment rate: 4.1%
• Personal income per capita: record $74.5K per household
• Labor force participation: 62.3% (–0.1%), consistent with 2015–2018 levels
• Rates: 10-year Treasury yields and mortgage rates 50 bps below recent highs
• Policy context: bond market pricing in two 25 bp cuts in 2025; Fed remains data dependent
• GSE securitization: near 10-year lows; Freddie Mac market share over 50%
• CRT eligibility: estimated share near all-time high of 80%
• Home prices: –0.7% quarter over quarter; +2.2% year over year
• State-level appreciation: 45 of 51 states (including D.C.) up; range from –4.2% (D.C.) to +7.4% (New York); strongest gains along the East Coast, especially the Northeast
View the full report here.
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