June 2025 Mortgage Market Update

The month of June 2025 is kicking off to be a very exciting one.
Looking back at May, we saw some major shifts in the market—and now, I think we’re going to see those continue into June.

We’re going to cover three big topics in this update:

1. Tariff Cooldown

2. Post-Spring Application and Inventory Trends

3. GSE Privatization Developments

1. Tariff Cooldown

Since the election and President Trump’s return to office, we’ve seen a lot of tariff volatility—on again, off again.
This back-and-forth movement defined much of May, and now heading into June, we’re starting to see something new:

Not necessarily a cooldown, but a normalization.
People are becoming more accustomed to the tariff whiplash, so the market’s response has been less dramatic.

Even if tariffs are activated or removed, the shock factor is lower now.

That said, the long-term consequences of the tariff shifts—positive or negative—are still unknown.
I expect continued uncertainty, but not quite as extreme as what we saw in April and May.

2. Post-Spring Application & Inventory Cooldown

As we head into mid-summer, we often hit what I call a “midsummer lull.”

Just like the stock market tends to slow down when traders head to their summer homes, the housing market also tends to cool slightly.

We typically see:

• January & February: Mortgage activity begins to ramp up

• March, April, May: Heavy-hitting months for applications

• June & July: Still active, but starting to cool

Especially for military families, moves can start earlier in the year. But by June, we start seeing purchase application momentum stall, which is exactly what we’ve seen over the past couple of weeks.

Inventory Watch:

• Housing inventory is now at its highest point in 2025

• We’ve broken 800,000 active listings

• Still historically low, but much higher than we’ve seen in the past 6–18 months

This could mean buyers are cooling down, but sellers are still listing, contributing to an inventory increase that matches the seasonal lull.

3. GSE Privatization

Now onto the big conversation that’s emerged in recent weeks:
Privatization of the GSEs (Government-Sponsored Entities).

💡 What Are GSEs?

• Fannie Mae & Freddie Mac

• They purchase and securitize the majority of conventional, FHA, and VA loans

• Backed by the federal government since the 2008 financial crisis

Prior to 2008, these were private companies. But after they collapsed, the government took control, placing them under conservatorship.

What’s New?

• President Trump and FHFA director (Pulte) have begun discussing removing the GSEs from conservatorship

• This would privatize them again and return them to independent status

Why This Matters:

Privatizing GSEs introduces a lot of uncertainty. There are strong arguments on both sides:

Pro-Privatization:

• Could increase competition in the secondary mortgage market

• New players could drive lower rates through innovation and pricing power

Against Privatization:

• GSEs currently benefit from implied government backing

• That backing keeps U.S. mortgage rates among the lowest in the world

• Removing it could raise rates, as investors would demand higher risk premiums

We don’t yet know where this will go—but for the first time in a long time, these conversations seem to have momentum.

Is It Serious?

It’s hard to say.
This might be another situation like tariffs—a lot of talk, but not necessarily real movement.

Still, with both the President and the FHFA Director pushing the idea, we could see some traction.

That said, many in Congress—especially Democratic Senators—are cautioning against moving too fast.

They argue that such a massive structural change to one of the largest financial operations in the world—the mortgage system—should be handled slowly and carefully.

“Quick moves could break things,” they say.
And I agree—we’re talking about trillions of dollars in loan volume.

So, will it happen?

Maybe.
But even if it does, it will likely take months—if not years—to complete. And there’s always a chance it doesn’t happen at all.

📈 Summary: What We’re Seeing in June 2025

• Tariff volatility is calming—not gone, but less shocking

• Spring mortgage applications have plateaued, and

• Inventory levels are rising with the midsummer lull

• GSE privatization talks are heating up, but much remains to be seen

My name is Evan Kaufman, your VA loan originator.

Thanks for tuning in to this month’s Mortgage Market Update.
Take care, and I’ll see you next time.