Tariffs, Treasuries, and Trump: What It All Means for Mortgage Rates and the DMV Housing Market
How Trump’s Tariffs, the Stock Market, and the 10-Year Treasury Could Impact Mortgage Rates and the DMV Housing Market in 2025
With Donald Trump's return to the White House and his bold trade agenda back in play, many are watching closely to see how his policies will influence the economy—especially mortgage rates and real estate markets. His new approach includes a 90-day pause on tariffs for 50 nations, while dramatically increasing tariffs on Chinese imports to 104%. While this might sound like a recipe for economic tension, the actual impact could be more nuanced—and, surprisingly, positive for interest rates and the housing market, particularly in the Washington DC region.
Interest Rates Could Ease
Markets thrive on stability—and this 90-day tariff pause sends a signal that global trade tensions are easing, at least temporarily. If inflation expectations drop or hold steady, the Federal Reserve may feel less pressure to raise interest rates further. In fact, the pause may even provide room to reduce rates if consumer demand softens or labor market data cools.
Simultaneously, investors reacting to uncertainty around China may shift their capital into U.S. Treasury bonds, particularly the 10-year Treasury. Increased demand for Treasuries pushes yields down, and since mortgage rates are closely tied to the 10-year yield, this can result in lower home loan rates nationwide.
What Happens to the Price of Goods?
While tariffs on Chinese goods are rising sharply, the broader pause on other trade restrictions offers relief. Importers can now bring in products from a wider range of countries without added costs, which helps stabilize or even reduce prices in many consumer categories—particularly appliances, home goods, and construction materials.
As companies diversify away from Chinese supply chains and turn to tariff-free partners, it may reduce the price pressure on goods and services overall. This has the dual effect of keeping inflation in check and making everything from groceries to lumber slightly more affordable for U.S. consumers.
Impacts on the DMV Real Estate Market
In the Washington DC, Maryland, and Virginia (DMV) region, real estate remains tightly connected to economic policy. Lower mortgage rates—driven by a dip in Treasury yields or Fed policy shifts—would likely reinvigorate buyer demand. That means:
- More affordability for first-time buyers
- Increased competition for listings in popular neighborhoods
- Faster sales cycles for well-priced properties
At the same time, a reduction in material costs (thanks to improved trade flexibility) could benefit homebuilders and renovators, helping to expand inventory and relieve pressure on the low-supply market.
For investors and landlords, steady or reduced inflation, paired with declining mortgage rates, could present a golden opportunity to refinance, acquire new properties, or expand portfolios.
Stock Market Influence and Housing Confidence
The stock market’s reaction to tariff news also matters. If markets respond positively to diplomatic overtures and improved trade conditions, we could see increased economic confidence, more consumer spending, and stronger homebuying activity. If investors remain cautious, however, and redirect assets into bonds or real estate, that could further lower Treasury yields—again softening mortgage rates and boosting housing demand.
In the DMV, where federal employment, contractor jobs, and policy shifts heavily influence local stability, a sense of predictability in global markets bodes well. Buyers and sellers are more likely to act when the economy feels steady—even if the headlines still involve big moves like a 104% China tariff.
Opportunity in a Transitional Market
For all the political noise and economic movement, what we’re seeing is a market in transition—and for those who are ready, that creates opportunity.
Buyers may find lower rates and more inventory ahead.
Sellers could benefit from renewed buyer interest and price stability.
Investors may be able to acquire properties at value before interest rates fall further and competition increases.
The key takeaway? Policy changes don’t always lead to chaos—sometimes they create clarity.
Final Thoughts
The combination of a 90-day tariff pause, selective increases on Chinese imports, and softening inflation could create a window of opportunity in the housing market—especially here in the DMV region. Whether you’re a buyer, seller, or investor, the best move is to stay informed, stay flexible, and lean on local expertise.
