Trump’s Economic Agenda and Its Impact on Mortgage Rates in 2025

Lisa Mailhot  |  November 28, 2024

Buyers

Trump’s Economic Agenda and Its Impact on Mortgage Rates in 2025

 

The housing market is at a crossroads, with high mortgage rates and home prices creating challenges for buyers and sellers alike. As we look ahead to 2025, economic policies, including potential tariff increases and tax cuts under Donald Trump’s agenda, are poised to play a pivotal role in shaping affordability and homeownership trends.

Mortgage rates currently range between 6% and 7%, influenced by factors like the U.S. economy's health, inflation, and Treasury yields. Policies that raise inflation, such as proposed tariffs on imports, could drive these rates even higher. Higher borrowing costs make homes less accessible, especially for first-time buyers, whose share in the market has dipped to historic lows.

 

For potential buyers, these high rates mean significant additional costs. For instance, a 1% increase in mortgage rates can add hundreds of dollars to monthly payments, impacting affordability and delaying wealth-building opportunities that homeownership provides. Despite these challenges, home prices may stabilize, offering some relief to buyers in 2025.

Owning a home remains one of the most effective ways to build wealth. While the economic outlook may feel uncertain, taking a step toward homeownership, even under less-than-ideal conditions, often yields long-term financial benefits.

Bottom Line

Whether you’re navigating high mortgage rates or exploring stable home prices, finding your perfect home in Orange County is within reach. 

Let’s connect to discuss your housing goals and make your dream home a reality.



Reference: “How Trump's economic agenda could affect mortgage rates in 2025” by Aimee Picchi. Published on November 27, 2024

RECENT BLOG POSTS

Where Have All the Vacation Home Buyers Gone? Exploring the 2024 Decline

Vacation home demand has tumbled to its lowest level in years as rising costs and shifting work norms dampen enthusiasm for second properties. This blog explores why i… Read more

Move-Up Buyers Fuel Mortgage Boom as Rates Dip

Mortgage loan applications surged 11% in late April/early May, largely driven by experienced buyers trading up to larger homes as mortgage rates briefly declined. With… Read more

Daycare Costs More Than Rent

Childcare costs are skyrocketing across the U.S., surpassing rent in most major metros. In cities like Denver and Seattle, families with two kids are paying over 160% … Read more

More Homes, Fewer Buyers in California Market

California home sales have dropped below Great Recession levels, while inventory has surged more than 50% in the past year. As buyers retreat due to affordability issu… Read more

Why Are Builders Stopping New Apartment Projects?

Multifamily building permits have plunged over 27% from their pandemic peak, signaling a major slowdown in new apartment construction. Learn how interest rates, tariff… Read more

Is This Unpredictable Spring Market a Good Time to Make a Move?

Despite a turbulent start to the spring buying season, market experts see reasons for optimism—especially in the new-home sector. With mortgage rates fluctuating, tari… Read more

Buyers Step Back as Monthly Housing Costs Hit Record Highs

The 2025 spring housing market is seeing stalled momentum, with homebuyers backing off amid economic uncertainty and soaring mortgage payments. With home prices and in… Read more

Are Sellers Overpricing Homes?

In today's shifting housing market, sellers are asking nearly $39,000 more than buyers are willing to pay—the widest gap since 2020. Learn what’s driving the divide be… Read more

Are Home Prices Still Going Up or Finally Slowing Down?

Home prices in the U.S. continue to climb, but the pace is slowing. February’s 3.9% annual increase signals a shift toward more sustainable growth, according to the FH… Read more

We are excited to assist you in finding your perfect home

Let's find a time that suits you best to chat about your goals, show you how we work, and figure out how we can help you the most