Tariffs, Inflation, & Mortage Rates: Here’s What’s Happening This Spring. The major news of the week includes a 90-day suspension of numerous tariffs. March inflation data from the Bureau of Labor Statistics This Week in Real Estate revealed a drop in overall price levels, with annual and core inflation reaching their lowest points in four years. The Consumer Price Index (CPI) dipped 0.1% in March, the first drop since May 2020, after gaining 0.2% in February. Over the 12 months through March, the CPI showed significant cooling in inflation, dropping to an annual rate of 2.4% from 2.8% in February. Core inflation, on a year-over-year basis, realized the smallest increase since March 2021. Additionally, the average 30-year fixed-rate mortgage continues its downward trend, staying below 7% for the twelfth consecutive week, averaging 6.62%, down from 6.64% the previous week. However, rates saw significant upward movement late in the week, rising above 7%. Last Friday, the average lender raised rates by roughly an eighth of a percent, marking the largest weekly jump since early 2022. This rise is attributed to the 10-year Treasury bond’s largest week-over-week increase since 1981. The Mortgage Bankers Association reported mid-week that recent purchase application demand had risen to its highest level since January 2024. Below are key events from the second week of April impacting our business:
INFLATION COOLED IN MARCH. Inflation slowed to a 6-month low in March. Despite the easing, the report likely only captures part of the first wave of global tariffs announcement. The inflationary pressure from tariffs and escalating trade war continues to threaten the economic growth and complicate the Fed’s path to its 2% target. Meanwhile, while housing inflation remains elevated, it continues to show signs of cooling – the year-over-year change in the shelter index remained below 5% for a seven straight month and posted its lowest annual gain since November 2021. During the past twelve months, on a non-seasonally adjusted basis, the Consumer Price Index rose by 2.4% in March, according to the Bureau of Labor Statistics’ report. This followed a 2.8% year-over-year increase in February. Excluding the volatile food and energy components, the “core” CPI increased by 2.8% over the past twelve months, the smallest increase since March 2021. A large portion of the “core” CPI is the housing shelter index (more than 40%), which increased 4.0% over the year, the smallest year-over-year increase since November 2021. On a monthly basis, the CPI fell by 0.1% in March (seasonally-adjusted), after a 0.2% increase in February. This was the first time the monthly CPI has fallen since May 2020. The “core” CPI increased by 0.1% in March. Read the full story here.
DID RECENT WILD MORTGAGE RATE SWINGS IMPACT HOUSING DATA. Last week, the financial markets reminded us of their dynamism as the 10-year yield rose sharply, pushing mortgage rates higher, but did it impact the housing market data? We have recently seen some pickup on the weekly sales data, and now our total pending sales data is positive year after year. Weekly pending contracts for the last week over the past several years: 377,633 (2025), 371,457 (2024) and 335,017 (2023). Spring is finally here, and I can’t help but feel exhilarated about the incredible story unfolding in the housing market for 2024 and 2025 – the growth of inventory! While we haven’t quite reached normal levels yet, our progress is a positive trend for the entire housing market, which is no longer savagely unhealthy. We had another week of good inventory growth. Weekly inventory rose from 691,197 to 702,434. The same week last year inventory rose from 512,930 to 526,479. The all-time inventory bottom was in 2022 at 240,497. The inventory peak for 2024 was 739,434. The new listings are a positive story in the housing market in 2025. The growth in new listings data is just trying to return to normal, where the seasonal peaks range between 80,000 and 110,000 per week. The national new listing data for last week over the previous several years: 76,270 (2025), 66,776 (2024) and 48,556 (2023). Read the full story here.
A ‘ROLLER COASTER RIDE’ FOR MORTGAGE RATES THIS WEEK. Economic uncertainty rattled mortgage rates this week – and the widely reported average rates for the week may not show the full picture, economists say. The 30-year fixed-rate mortgage averaged 6.62%, down slightly from last week’s 6.64% average, Freddie Mac reported Thursday. But some lenders showed much higher rates by the end of the week, near or even slightly above 7% averages. This week had it all: global tariff spats, stock market volatility, and news on Thursday of slightly easing inflation. Some home shoppers jumped to lock in the lower rates offered last week and earlier this week, Lautz says. That helped fuel an uptick in mortgage applications for home purchases – a gauge of future homebuying activity. Applications climbed 9% week-over-week and 24% year-over-year, the Mortgage Bankers Association reported on Wednesday the highest level in purchase demand since January 2024. Read the full story here.
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