Falling mortgage rates offer a bright spot amid tariff chaos — but the trade war creates new hazards

Mortgage rates fell to a six-month debased connected Friday, lowering 1 of the biggest barriers for US lodging shoppers.

According to information from Mortgage News Daily, the 30-year fixed complaint dropped from 6.75% to 6.55% betwixt Wednesday and Friday, hitting the lowest level since October.

Trump's harsher-than-expected tariffs prompted investors to question refuge among safe-haven Treasury bonds this week, driving yields down. Mortgage rates intimately way long-dated enslaved yields. As it stands, the benchmark 10-year Treasury output dropped beneath 4% for the archetypal clip since October connected Friday, helping to easiness the

Initially, this should look similar invited quality for buyers navigating a historically unaffordable lodging market. Elevated rates person kept existent homeowners from selling, reducing marketplace inventory and boosting location prices. In 2025, this has translated into a lodging cooldown, with transaction enactment slowing to a crawl.

It's logical to expect falling rates to revive demand, but to immoderate analysts, this could beryllium a short-lived window. That's if tariffs disrupt proviso chains and boost inflation, which would punctual involvement rates — and, consequently, enslaved yields — to enactment up.

"Mortgage rates are going down astatine the moment. However, erstwhile the higher costs of goods commencement to propulsion up the ostentation rate, it is rather imaginable that rates volition spell backmost up. I expect to beryllium connected a owe complaint roller coaster for the adjacent fewer months," Melissa Cohn, determination vice president of William Raveis Mortgage, said.

That's due to the fact that tariffs could rise ostentation and support expectations for involvement rates high, successful turn, keeping enslaved yields high. The propulsion and propulsion betwixt ostentation forecasts and maturation fears could support enslaved yields stuck successful a constrictive range, keeping a level nether owe rates.

Though acquisition applications jumped to their highest level successful astir 2 months conscionable up of the tariff announcement, analysts suggest the commercialized warfare could exacerbate marketplace headwinds.

Recent duties are expected to summation the mean outgo of a location by $9,200, according to the latest National Association of Home Builders survey. An estimated 7.3% of goods required successful residential operation were imported into the US successful 2024.