Overview

• Mortgage rates have dropped to 6.55%, their lowest level since October 2024, following President Trump's tariff announcement, which pushed investors toward safe-haven Treasury bonds.
• Lenders are expected to launch a competitive price war in response to falling swap rates, with some institutions already cutting mortgage rates by up to 0.21 percentage points.
• Increased housing inventory and slower price growth are giving buyers more negotiating power, though affordability remains a significant challenge for many Americans.
• Economists warn that the tariffs could eventually fuel inflation, potentially reversing the current decline in mortgage rates and increasing long-term borrowing costs.
• Despite the temporary boost in purchasing power due to lower rates, housing costs remain near record highs, keeping many potential buyers on the sidelines.