How New Tariffs Triggered a Drop in Mortgage Rates — and Why That’s Good News for Buyers

In a surprising but welcome shift, mortgage rates have dropped to their lowest level since October 2024, following the announcement of new U.S. trade tariffs. For homebuyers who have been waiting for a break in affordability, this is it.

Mortgage Rates Just Took a Meaningful Dip

The average 30-year fixed mortgage rate now sits around 6.61%, a significant decline from recent months. That may not sound like a major move, but the impact is real:

• A lower rate increases your purchasing power
• Monthly payments on the same home are now more affordable
• Many buyers can now qualify for more home without stretching their budget

This is the kind of shift that can make the difference between watching and buying.

What Do Tariffs Have to Do With Mortgage Rates?

Here’s what’s happening behind the scenes:

When tariffs were announced, it created uncertainty in the global economy. In response, investors shifted their money into safe-haven assets like U.S. Treasury bonds. That surge in bond demand caused yields to drop — and since mortgage rates are closely tied to those yields, rates fell quickly.

In other words, these new tariffs indirectly triggered a market shift that led to more favorable borrowing conditions for homebuyers.

Buyer Activity Is Already Picking Up

According to the Mortgage Bankers Association, mortgage application volume surged more than 20% in the wake of this rate drop. That’s a strong signal: buyers are noticing, and they’re acting.

If you’re considering buying, this is the window to jump in before competition ramps up.

Inventory Is Still Available — But That’s Changing Fast

In many parts of the Coachella Valley, from Palm Springs to La Quinta, there’s still a healthy selection of homes on the market. But as rates drop and buyer activity returns, we’re expecting:

• Shorter days on market
• Increased multiple offer situations
• Fewer price reductions from sellers

That means buyers who act now are more likely to find the right home with leverage still in their favor.

A Market Tilt Toward Sellers Is Coming

The real estate market is dynamic — and right now, it’s in motion. We’re seeing the early signs of a shift back toward a seller’s market:

• Demand is growing
• Rates have improved
• Buyer confidence is returning

Buying now, while rates are still low and inventory is still accessible, gives you the edge before prices respond to this shift.

Avoid the fear of missing out.

This drop in mortgage rates is a direct result of current market conditions — not speculation, not headlines. It’s real. It’s measurable. And it’s working in favor of today’s homebuyers.

If you’ve been waiting for the right time, this is your signal. The opportunity is here — and the smart move is to act while others are still thinking.