From Yahoo Finance: 2025-06-03 07:08:00

U.S. home prices are expected to rise steadily over the coming years due to a decline in mortgage rates, with experts expressing concern that President Trump’s tariffs will hinder affordable home construction. Analysts predict a 3.5% annual increase in home prices through 2027, the slowest pace since 2011.

Construction spending has fallen unexpectedly, constrained by a decline in single-family housing projects and rising unsold inventory, with experts warning that Trump’s tariffs will further limit affordable home construction. Respondents believe fewer homes will be built due to increased costs.

President Trump’s tariffs and policies are expected to lead to higher borrowing costs, hindering the housing market’s ability to lower mortgage rates. Experts predict no more Fed rate cuts this year, with mortgage rates potentially reaching 7%. Only half of experts believe affordability for first-time homebuyers will improve in the coming year.

Read more: US home prices to rise 3.5% this year but tariffs will hinder new construction :Reuters poll