BISMARCK, N.D. (KFYR) – Tariffs are sparking changes across the board, now impacting bonds and mortgage rates. The volatility we’ve seen in rates has posed new challenges for home buyers and sellers.
Finding the perfect home for a growing family is difficult under any circumstances.
“You want to be a little bit more picky on what you’re getting into,” said Bismarck home buyer and home seller Chris Pederson.
And while he was able to find their perfect “forever home,” he said mortgage rates lessened their buying power.
“You pay almost double for a mortgage rate from 10 years ago to now. The interest alone just increases your monthly payment. So, it limits what you can afford and look into on your next home,” said Pederson.
And realtors say that lack of buying power is also impacting sellers, especially those with higher-priced homes.
“From a seller’s perspective, as the interest rates go up, the buyer pool starts to tighten up. Buyers then get concerned with having to drop their price, and they also get concerned with days on the market,” said Bianco Realty Realtor Amber Sandness.
Home loan expert David Weikum said tariffs initially led to a drop in mortgage rates because investors were seeking safer assets, leaving the stock market and flooding the treasury market. He said when the treasury market’s up, mortgage rates go down.
“We did see interest rates almost push down into the fives and then quickly reverse the last two days into the low to mid sixes,” said Bismarck eLendingNow President and Owner David Weikum.
As uncertainty about the economy and inflation persisted, he said rates climbed back up. But he said there’s hope.
“Any time goods and services are more expensive, the Federal Reserve will keep interest rates up or push interest rates up to keep the economy from getting too hot or over-inflating. We’re starting to see where prices have come down dramatically. If that continues, then the Federal Reserve can come in and take a look at doing interest rate reductions,” said Weikum.
Major financial organizations expect the Fed to make between one and five cuts to mortgage rates throughout 2025.
Pederson said he’s not too optimistic about rates coming down, but if they do, he said he’d be interested in refinancing.
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