New York, Jan 11, 2026, 18:16 EST — Market closed
- After a strong rally on Friday, Opendoor shares are pulling back as investors take profits on housing-related names
- Trump launched a $200 billion mortgage-bond purchase initiative designed to cut borrowing costs
- The coming week depends on follow-through: how quickly purchases proceed, shifts in mortgage spreads, and any new policy updates
U.S. markets are shut for the weekend, but Opendoor Technologies Inc (OPEN.O) is coming off a strong Friday. Shares finished up 13.2% at $7.29, on volume around 167 million. The stock swung between $6.82 and $7.91 during the session.
Opendoor’s approach is straightforward but fragile. It buys homes, holds inventory, and aims to flip them fast. Rising mortgage rates, however, can stall that turnover almost immediately. Even slight changes in borrowing costs impact demand, pricing, and financing expenses for the homes it owns.
Housing-related stocks surged Friday after President Donald Trump announced a $200 billion purchase program targeting mortgage-backed securities (MBS) to help lower housing costs. Opendoor climbed nearly 19% at one point, with mortgage lenders loanDepot, Rocket Companies, and UWM Holdings, plus homebuilders Lennar, D.R. Horton, and PulteGroup, also gaining. TD Cowen suggested the move might tighten the spread between 30-year mortgage rates and the 10-year Treasury yield. Jefferies pegged the “back-to-market” mortgage rate level around the mid- to high-5% range. But Brian Jacobsen, chief economic strategist at Annex Wealth Management, cautioned this approach could be “self-defeating” if demand surges ahead of supply. (Reuters)
U.S. Treasury Secretary Scott Bessent said the plan is to roughly match the Federal Reserve’s monthly runoff of about $15 billion in mortgage-backed securities. The Federal Housing Finance Agency kicked off with a $3 billion initial purchase, while the Fed still holds just over $2 trillion of these bonds. Bessent noted the buying probably won’t lower mortgage rates directly but could narrow the spread versus Treasuries. Currently, average 30-year mortgage rates sit around 6.2%, down from nearly 8% earlier this year. (Reuters)
The policy move also reignited debate over the long-delayed exit of Fannie Mae and Freddie Mac from government control. TD Cowen analyst Jaret Seiberg noted that Trump’s language “does not sound like a President who is in a rush to IPO” the mortgage giants. Mike O’Rourke, an analyst at JonesTrading, warned that if these firms turn into a “funding arm” for presidential policy, investors shouldn’t count on re-privatization. (Reuters)
Trump revealed the plan on Truth Social, claiming the $200 billion mortgage bond purchases would “drive Mortgage Rates DOWN” and reduce monthly payments. FHFA Director Bill Pulte told Reuters the firms have “ample liquidity” to carry out the buys, despite their combined cash and cash equivalents totaling less than $17 billion as of Sept. 30, according to third-quarter filings. The strategy mirrors the Fed’s previous quantitative easing efforts, but Chen Zhao, head of Redfin economics research, said the $200 billion injection would likely nudge rates only about 10 to 15 basis points (0.10 to 0.15 percentage points). Pulte declined to specify a timeline, citing upcoming housing initiatives at Davos. (Reuters)
Opendoor traders face a simple dynamic: lower mortgage rates usually boost the number of buyers and sellers, pushing up transaction volume. Still, the stock often acts like a lever on rates itself, sometimes swinging too far in either direction when the news breaks.
But the policy trade isn’t guaranteed to hold. If bond purchases fail to lower mortgage rates significantly, the sector could quickly surrender its gains. And should easier credit boost demand without a matching rise in supply, home prices may climb again, undercutting affordability and keeping turnover sluggish.
Trading picks up Monday, and all eyes will be on the gap between mortgage bonds and Treasuries to gauge if the program is making an impact. The details on pace and how it’s executed will carry more weight than the top-line figure. Since housing-related stocks have been closely tied, a shift in lenders or homebuilders might ripple through to Opendoor.
The World Economic Forum’s annual gathering in Davos is set for Jan. 19–23, marking a key moment on the policy calendar. Investors in Opendoor want to see if the mortgage-bond program actually drives down rates and boosts housing activity before the current rally fades. (World Economic Forum)
