US Housing Market Doesn’t Have Much ‘Tailwind’: Lowe’s CEO

If there’s anyone more exasperated by the locked-up housing market than your average millennial, it’s Marvin Ellison, CEO of Lowe’s.

While the company reported a revenue beat during its fourth-quarter earnings call on Wednesday, lower-than-expected 2026 guidance soured the mood. Shares dropped 5.5%, and, in an interview with CNBC, Ellison said there was an obvious culprit for the company’s woes: “[The US is] still dealing with a housing market that does not have a lot of tailwind […] the greatest fuel for the home improvement industry is when you decide to put your house on the market.” 

The Big Shill

Potential homebuyers have been bludgeoned and rebuffed by the devastating one-two punch of rising prices and rising mortgage rates for years now. Finally, however, both forces are starting to lose a bit of their sting. The average 30-year fixed mortgage rate has fallen to 6.01%, according to Freddie Mac, the lowest level since 2022. Meanwhile, the latest S&P Cotality Case-Shiller Index reading, out Tuesday, showed that the value of single-family US homes increased just 1.3% year-over-year in December, the slowest growth rate since 2011.

On their surface, each stat looks encouraging for homebuyers. A look under the hood reveals significant market-force reversals that may spur even more optimism:

• The home value growth shown by the Case-Shiller index is much lower than the 2.7% headline inflation rate in December, as reported by the US Bureau of Labor Statistics Consumer Price Index. “This marks a notable reversal: Over the prior decade, national home prices outpaced inflation by 3.7 percentage points annually,” Nicholas Godec, head of fixed income tradables and commodities at S&P Dow Jones Indices, told Realtor.com this week.
• Meanwhile, the number of homeowners with mortgage rates above 6% is now roughly equal to those with rates below 3% (about 20% of all US homeowners in each group), according to recent ICE Mortgage Technology data. In 2022, just 10% of homeowners had rates above 5%.

The shift toward more homeowners paying higher mortgage rates is “loosening the fiscal handcuffs that many potential sellers faced. They didn’t want to give up that great rate,” Alex Vidal, brand president at ERA Real Estate, told The Daily Upside.

Signal and Noise: Still, the handcuffs appear bruisingly tight. Pending home sales in January fell 0.8% month-over-month and 0.4% year-over-year, according to National Association of Realtors data. That continues (though somewhat softens) a trend that began in December, when sales fell a full 3% year-over-year, marking the biggest dropoff for the month since 2001. In other words, the housing market is giving off more mixed signals than millennials have seen since their forays into middle school dating.