Mortgage rates stuck in a rut as economy turns gloomy. What's next for the housing market?
Show Caption
Hide Caption
How far did the US fall in the world happiness rankings?
The U.S. has dropped to its lowest spot yet on the World Happiness Report. The Nordic countries still dominate the top of the list.
Rates for home loans ticked up fractionally but stayed in the same narrow range they've been in for several months.
In the week ending March 20, 30-year fixed-rate mortgages averaged 6.67%, Freddie Mac announced Thursday. That's only slightly up from 6.65% last week, but not low enough to spark major moves in the mortgage market: applications for home loans were down 6.2%, the Mortgage Bankers Association said.
Those figures don't include fees or points, and rates in some parts of the country may be higher or lower than the national average.
If mortgage rates aren't making much headway one way or the other this year, neither is the housing market itself. Sales of previously-owned homes jumped in February, the National Association of Realtors said Thursday, after falling in January.
When it comes to new housing stock, economic indicators are also mixed. Builders broke ground on more new homes than expected in February, the Commerce Department reported earlier this week. The pace set in February was a 12-month high, and may have been an attempt to get ahead of tariffs.
Indeed, a measure of homebuilder sentiment fell to a seven-month low in March.
Many Americans considering buying a home have waited for years for rates to stabilize or inventory to become available. But analysts are increasingly concerned that deteriorating economic conditions will simply sideline many would-be buyers.
'Consumer worries about losing their jobs are at levels normally seen during recessions,' wrote Apollo Global Management Chief Economist Torsten Slok in a note out Sunday. 'A record-high share of consumers think business conditions are worsening,' Slok added. 'The bottom line is that consumer sentiment is deteriorating at an alarming rate.'
Nancy Vanden Houten, lead U.S. economist at Oxford Economics, echoed that view in a note sent after the existing-home sales data. 'A recent downtick in mortgage rates may lend some support to home sales in the months ahead, but that could be countered by growing uncertainty on the part of households about the economy,' she wrote. 'We look for sales to move sideways in 2025.'
In March, homebuilders reported that the number of prospective buyers taking tours was at its lowest in 15 months.
Some observers believe only outside-the-box thinking will solve the affordability crisis in housing. As previously reported, one woman in the Tulsa, Oklahoma area, is building tiny homes in a factory to help mitigate rising costs and lack of inventory.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Newsweek
an hour ago
- Newsweek
Former Treasury Secretary Says Trump Is Trying to 'Scapegoat' Jerome Powell
Based on facts, either observed and verified firsthand by the reporter, or reported and verified from knowledgeable sources. Newsweek AI is in beta. Translations may contain inaccuracies—please refer to the original content. Former U.S. Treasury Secretary Larry Summers warned that President Donald Trump may be trying to "scapegoat" Federal Reserve chair Jerome Powell in the event the economy slows down enough to hit a recession. "He's looking to set up a scapegoat if the economy performs badly," Summers said during an appearance on ABC News' This Week. "That's what this attacking chairman Powell is really about. It's not really about trying to change policy." Newsweek reached out to the White House by email outside of normal business hours on Sunday morning for comment. Why It Matters Trump has made tariffs the centerpiece of his economic and foreign policy plans, using trade negotiations to try and end conflicts and completely reshape the international trade landscape to more heavily favor the United States. However, many economists and business leaders have warned that Trump's plan will cause a recession as the tariffs raise prices for Americans, which could deter buying and prompt more Americans to hold onto their money. Trump has therefore urged Powell to cut the interest rate in order to spur the economy and get people to spend more money, but Powell has resisted—much to Trump's frustration. What To Know The stock market took a hit on Friday after Trump signed a series of executive orders to impose tariffs on over 90 countries, ranging from 10 to 41 percent. The July Jobs report showed that growth had slowed, showing just 73,000 new jobs—well under the projected 100,000 that the Dow Jones had estimated. Additionally, the jobs reports for May and June were hit with significant revisions that showed very weak growth across those months. Trump fired Dr. Erika McEntarfer, the Commissioner of the Bureau of Labor Statistics (BLS), and accused her of manipulating the reports for "political purposes." Summers, who served in former presidents Bill Clinton's and Barack Obama's administrations, suggested on Sunday that Trump is likely also trying to line up Powell as a scapegoat should the economy continue to struggle, even though Trump appointed Powell during his first term in office. "I think that this kind of political Fed bashing is a fool's game," Summers said. "The Fed doesn't listen, so short-term interest rates aren't going to be different because of it." He continued: "The market does listen, and so longer-term rates are going to go higher, which is going to make it more expensive to buy a house. This is hurting the economy, not helping. I think the president understands that and what the president is doing is recognizing that, for all kinds of reasons, of which his policies are very important ones, the economy is at a lot of risk." Summers also expressed surprise that more people hadn't responded within the administration to McEntarfer's firing, saying that the decision to remove her "is way beyond anything that Richard Nixon ever did." When Nixon dismissed special prosecutor Archibald Cox during the Watergate Scandal, it prompted several officials to resign rather than fire Cox, causing what was known as the "Saturday Night Massacre." Trump faced a similar issue in February, which has been likened to Nixon as the "Thursday Night Massacre," when Department of Justice (DOJ) officials resigned rather than execute an order to dismiss federal corruption charges against New York City Mayor Eric Adams. No one has yet resigned in response to McEntarfer's firing, but Summers indicated that he sees the firing as a scapegoating as well, saying: "These numbers are put together by teams of literally hundreds of people following detailed procedures that are in manuals." "There's no conceivable way that the head of the BLS could have manipulated this number," he added. "The numbers are in line with what we're seeing from all kinds of private sector sources." Summers remains cautious about suggesting the economy is headed for a recession. Instead, he said the economy is at "stall speed," which "could tip into recession," but that "wouldn't be my prediction right now." Former U.S. Treasury Secretary Larry Summers speaks during the World Economic Summit in Washington, D.C., on April 17, 2024. Former U.S. Treasury Secretary Larry Summers speaks during the World Economic Summit in Washington, D.C., on April 17, 2024. Mandel Ngan/AFP via Getty Images What People Are Saying President Donald Trump in a post on Truth Social on Saturday wrote: "'Too Late' Powell should resign, just like Adriana Kugler, a Biden Appointee, resigned. She knew he was doing the wrong thing on Interest Rates. He should resign, also!" In a post from Friday, Trump wrote: "Jerome 'Too Late' Powell, a stubborn MORON, must substantially lower interest rates, NOW. IF HE CONTINUES TO REFUSE, THE BOARD SHOULD ASSUME CONTROL, AND DO WHAT EVERYONE KNOWS HAS TO BE DONE!" Ernie Tedeschi, the former head of Yale University's Budget Lab, wrote on X on Friday about McEntarfer's firing: "I've worked closely with Erika. I know of no economist who is more data-focused & devoted to truth in statistics. She never shied from speaking truth to power when the data were disappointing. Nothing would be worse for US credibility than political meddling in our economic data."
Boston Globe
3 hours ago
- Boston Globe
Trump's tariffs are making money. That may make them hard to quit.
Get Starting Point A guide through the most important stories of the morning, delivered Monday through Friday. Enter Email Sign Up 'The good news is that Tariffs are bringing Billions of Dollars into the USA!' Trump said on social media shortly after a weak jobs report showed signs of strain in the labor market. Advertisement Over time, analysts expect that the tariffs, if left in place, could be worth more than $2 trillion in additional revenue over the next decade. Economists overwhelmingly hope that doesn't happen and the United States abandons the new trade barriers. But some acknowledge that such a substantial stream of revenue could end up being hard to quit. Advertisement 'I think this is addictive,' said Joao Gomes, an economist at the University of Pennsylvania's Wharton School. 'I think a source of revenue is very hard to turn away from when the debt and deficit are what they are.' The Port of Baltimore on June 30, 2025. ALYSSA SCHUKAR/NYT Trump has long fantasized about replacing taxes on income with tariffs. He often refers fondly to American fiscal policy in the late 19th century, when there was no income tax and the government relied on tariffs, citing that as a model for the future. And while income and payroll taxes remain by far the most important sources of government revenue, the combination of Trump's tariffs and the latest Republican tax cut does, on the margin, move the United States away from taxing earnings and toward taxing goods. Such a shift is expected to be regressive, meaning that rich Americans will fare better than poorer Americans under the change. That's because cutting taxes on income does, in general, provide the biggest benefit to richer Americans who earn the most income. The recent Republican cut to income taxes and the social safety net is perhaps the most regressive piece of major legislation in decades. Placing new taxes on imported products, however, is expected to raise the cost of everyday goods. Lower-income Americans spend more of their earnings on those more expensive goods, meaning the tariffs amount to a larger tax increase for them compared with richer Americans. Tariffs have begun to bleed into consumer prices, with many companies saying they will have to start raising prices as a result of added costs. And analysts expect the tariffs to weigh on the performance of the economy overall, which in turn could reduce the amount of traditional income tax revenue the government collects every year. Advertisement 'Is there a better way to raise that amount of revenue? The economic answer is: Yes, there is a better way, there are more efficient ways,' said Ernie Tedeschi, director of economics at the Yale Budget Lab and a former Biden administration official. 'But it's really a political question.' Workers welded steel components together at a Thomas Built Buses plant in High Point, N.C., on July 21, 2025. TRAVIS DOVE/NYT Tedeschi said that future leaders in Washington, whether Republican or Democrat, may be hesitant to roll back the tariffs if that would mean a further addition to the federal debt load, which is already raising alarms on Wall Street. And replacing the tariff revenue with another type of tax increase would require Congress to act, while the tariffs would be a legacy decision made by a previous president. 'Congress may not be excited about taking such a politically risky vote when they didn't have to vote on tariffs in the first place,' Tedeschi said. Some in Washington are already starting to think about how they could spend the tariff revenue. Trump recently floated the possibility of sending Americans a cash rebate for the tariffs, and Sen. Josh Hawley, R-Mo., recently introduced legislation to send $600 to many Americans. 'We have so much money coming in, we're thinking about a little rebate, but the big thing we want to do is pay down debt,' Trump said last month of the tariffs. Democrats, once they return to power, may face a similar temptation to use the tariff revenue to fund a new social program, especially if raising taxes in Congress proves as challenging as it has in the past. As it is, Democrats have been divided over tariffs. Maintaining the status quo may be an easier political option than changing trade policy. Advertisement 'That's a hefty chunk of change,' Tyson Brody, a Democratic strategist, said of the tariffs. 'The way that Democrats are starting to think about it is not that 'these will be impossible to withdraw.' It's: 'Oh, look, there's now going to be a large pot of money to use and reprogram.'' Of course, the tariffs could prove unpopular, and future elected officials may want to take steps that could lower consumer prices. At the same time, the amount of revenue the tariffs generate could decline over time if companies do, in fact, end up bringing back more of their operations to the United States, reducing the number of goods that face the import tax. 'This is clearly not an efficient way to gather revenue,' said Alex Jacquez, a former Biden official and the chief of policy and advocacy at Groundwork Collaborative, a liberal group. 'And I don't think it would be a long-term progressive priority as a way to simply collect revenue.' This article originally appeared in
Epoch Times
3 hours ago
- Epoch Times
Tariff Rates ‘Pretty Much Set,' Says US Trade Representative
President Donald Trump's trade representative, Jamieson Greer, said that Americans should expect the administration's tariff levels to remain where they are, even as some trading partners look to negotiate deals past a key deadline. In an interview with CBS's 'Face the Nation with Margaret Brennan' taped on Aug. 1 but aired on Aug. 3, Greer said he does not expect trading partners that have yet to strike deals with the United States negotiate tariffs down in the coming days.
