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Tariffs & Utah Housing
How tariffs are expected to affect the spring Utah housing market in 2025.
Hi there,
Today, I'm bringing you the latest insights on how recent tariff announcements could impact Utah’s housing market.
Before we dive in, my intention is not to be political or even argue for or against these policies; but rather, highlight how these policies could affect the housing market, and hopefully allow you to win in the current and changing market dynamics. Keep in mind, these policies and market dynamics are changing every day and seems to be changing quickly. I will continue to keep you updated as the market evolves.
Table of Contents
The Tariff Effect on Home Construction

President Trump recently announced extensive new tariffs on imports from various trading partners. While some building materials like lumber from Canada have been exempted, many other construction materials will face increased costs. The National Association of Home Builders estimates these tariffs could add between $7,500 and $10,000 to the cost of building a typical single-family home. Some estimates from CoreLogic suggest construction costs could increase by 4% to 6% over the next 12 months, potentially adding $17,000 to $22,000 to new home prices.
These increased costs stem from tariffs on essential building materials and appliances, particularly those imported from China, which now faces a combined tariff of 54% (a 34% tariff added to the existing 20% rate).
Will Home Prices Actually Rise?
Here's where things get interesting. While building costs are expected to increase, this doesn't automatically mean home prices will rise proportionally. In our current market, builders may need to absorb some of these additional costs to maintain sales momentum. We’re already seeing builders offer pretty incredible incentives to homebuyers to keep units moving. With housing affordability already stretched thin, builders have limited ability to pass costs directly to consumers.
In fact, I just got the inside scoop of Edge Home’s latest incentives for home buyers, which is show below. DR Horton, Lennar, Edge Homes, an many others are offering the best incentives I’ve seen from any builders at any point. Potentially allowing buyers to get into homes with very little money out of pocket while securing a great interest rate.

So while I wouldn’t expect huge price shifts in the short term, I would expect many builders to slow down building in a market where we’re already lacking supply. This could lead to more long-term price increases. Keep in mind, real estate is not like the stock market. Economic trends overall tends to affect the housing market slowly, rather than overnight like we see in the stock market.
Mortgage Rates: A Silver Lining

Following President Trump’s tariff announcement on Wednesday, mortgage rates fell sharply, with the average 30-year fixed mortgage dropping by 20 basis points to 6.55% as of April 4th—the lowest level since October.
This decrease occurred because economic uncertainty sent investors flocking to Treasury bonds, driving down yields. Since mortgage rates typically align with 10-year Treasury yields, this movement translated to lower borrowing costs for homebuyers.
The Federal Reserve's Balancing Act
While mortgage rates have dropped, there's an important caveat to consider. If tariffs lead to prolonged inflation, as many economists fear, the Federal Reserve may be hesitant to reduce its policy rate. This could keep mortgage rates higher for longer than previously anticipated.
The Fed faces a delicate balancing act: addressing inflation concerns while supporting economic growth. If economic indicators worsen significantly, they might be forced to cut rates despite inflation concerns, but this remains uncertain for now.
Long-Term Employment and Wage Outlook
Looking further ahead, many argue the tariff policy could lead to more manufacturing jobs returning to the U.S. and higher wages for American workers. If this materializes, increased employment and higher incomes could improve housing affordability despite higher construction costs. Only time will tell.
What This Means for Utah
If you're currently in the market:
Consider taking advantage of the recent drop in mortgage rates
Be aware that new construction prices may increase in the coming months
Existing homes might become relatively more attractive if new home prices rise
Don't wait too long—while rates have dropped, home prices in our area remain competitive
As your dedicated real estate agent, I'm here to help you navigate these changing market conditions. Whether you're looking to buy, sell, or simply want to discuss how these economic shifts might affect your specific situation, don't hesitate to reach out.
Here to serve,
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P.S. Do you know someone who might benefit from this information? Please feel free to forward this newsletter to friends or family who are considering a move in 2025!