Market Update: Rates Inch Higher Following Tariff Insights; Home Prices Cool

Blog posted On March 26, 2025

Mortgage rates had been on a nice downward trend until this past weekend. Following an announcement regarding reciprocal tariffs coming out April 2, rates trended higher. In other housing news, home values continued to show strength while new home prices cooled. Let’s dive into the insights below.

Reciprocal tariffs send rates trending slightly higher 

Last week, the White House announced that there would be flexibility on tariffs slated for April 2. The approach will be narrower and more targeted, leading to a sigh of relief from the stock market. Investors pivoted from bonds to stocks, signaling economic strength and therefore sending rates slightly higher. The key word is slightly. They are still trending lower than they were in February and hovering around the same levels as last fall.

Positive signs in housing news

1. The pending home sales count from Altos showed that this week’s contract signings finally exceeded the contract signings from the same time last year. This is the first time this year that weekly pending sales have exceeded 2024 levels from the same period.
2. Inventory saw a 2% weekly climb and was 30% higher than the same time last year. Home supply is growing at a faster rate than it was last year at this time. More people are listing their homes and jumping into the market.
3. According to Altos, home prices are barely up compared to the same time last year. The 20-city Case Shiller home price index showed that price appreciation was up 4.7% year-over-year in January. This is good news for anyone looking to sell their homes (or for new buyers hoping to gain equity fast).
4. New home sales climbed 1.8% in February, which is good, but lower than the expected gain. The median price of new houses sold was $414,500, down 1.5% from a year ago. This could be a good opportunity for hopeful buyers, especially if rates continue trending around lower levels than the beginning of the year.

Coming up in housing news…

Later this week, we have the PCE index, which will give us an update on inflation levels. Next week, we’ll see how reciprocal tariffs shake out. We’ll also get an update on the job market. Stay tuned and let us know if you have any questions or would like some more insights.

Sources: Bloomberg, Housingwire, Mortgage News Daily