Tariff wars have filtered into the housing market in 2025. While many real estate industry participants were expecting a more friendly administration for business, so far we’ve experienced the complete opposite. Trump’s sabre rattling and mercantilistic stance on foreign trade has upended the stock market and put a damper on the housing market. Not surprisingly, North Texas home sales remain stuck in the mud of volatility.
Closed home sales across North Texas fell 5.8 percent year-over-year in February. Pending contracts decreased 6.9 percent. Denton County saw similar decreases in activity. Median and average home prices were flat compared to February of last year. That’s flat as in zero price growth. Something to keep in mind when you get start receiving those assessment notices from the appraisal district in the next few weeks.
The End of American Exceptionalism
For all of the talk about making America great again, the new administration has an odd way of showing it. So far basic policy has centered on more censorship, tariff wars, more trickle-down wealth policies and a huge pile of uncertainty for business owners.
Continued tariff banter is causing disruptions across various markets. The Trump administration appears to have embraced mercantalism and and rent seeking at the expense of stable policy. Grift seems to be the new standard currency. Various regulatory agencies are seeing their budgets cut or just completely dismantled in favor of more financial deregulation. For those paying attention, that’s not good for the economy or the housing market.
I’m old enough to remember that is was unhinged financial deregulation that brought us the 2008 housing debacle. Agencies like the Consumer Financial Protection Bureau (CFPP) might not be friendly to unscrupulous actors in the business sector, but big business has demonstrated they have no interest in regulating themselves.
Volatility is Not Good for Home Sales
If you are concerned about the health of the housing market, it should be obvious that volatility and uncertainty are not good for housing. While the current adminstration has made the 10-year Treasury yield a specific focus for reviving the economy, they have little to show for it. Inflation is still firmly embedded in the U.S. economy. Tariffs are not a good idea if you want lower bond yields and lower inflation…unless your intent is to actually crash the economy. The slight decrease in mortgage rates so far in 2025 has been offset by heightend risk in the economy and employment sector.
Uncertainty with policy is making it difficult for home buyers and sellers to plan. With tariffs on one week and delayed the next, the continual blustering and fighting over trade agreements has injected a new level of risk into the housing market.
I’m keeping a close eye on inventory. If you are in the market to sell a home, the landscape is a moving target. Available home inventory is also on the rise again. That’s creating more competition among sellers. It’s easy to understand why some home buyers might be a little skittish given the current backdrop. Markets like Celina Texas are getting a dose of cold water as the 2022 bubble euphoria is replaced by big price declines and a spike in available home inventory.
If you are in the market to buy or sell a North Texas home, be safe out there. It looks like we’re in for a bumpy ride.
Great insight and analysis. Thanks for the updates!