Tarriffs and Real Estate Update - May 2025

Markets are calm for now, but credit concerns and stagflation risks could send rates higher fast.
[Published 5/19/2025]

We got a small win last week: inflation came in a bit lower than expected. But before you pop the champagne, here’s the catch—rates didn’t move. That’s because markets expect the full impact of the new tariffs hasn’t hit yet.

Then, just 10 minutes before markets closed Friday, Moody’s downgraded the U.S. credit outlook—a first in history. It flew under the radar, but don’t be surprised if it rattles markets and pushes rates higher this week as investors shift away from the U.S. Treasuries.

Meanwhile, Powell’s message stayed firm: the Fed is preparing for rising inflation and unemployment—aka stagflation. That typically keeps rate cuts off the table, even if growth slows.

This week brings a string of Fed speeches, but the tone likely won’t change. Instead, watch for headlines on tariffs to drive market movement.

Smart Buyers Move When Others Hesitate

You’ve probably seen the headlines—buyers backing out, markets stalling. But here’s what the data says for year-over-year growth. 

 Inventory is up 33% 

 Pending sales are up 2%

 Purchase applications are up 17% 

It’s true: some buyers are hesitating. But the smart ones? They’re using this uncertainty to negotiate better deals and lock in a home before rates shift again.

Let’s build your game plan—while the window is still open.  Connect with us here.

Source:  Housingwire.com