April 15, 2025
There are plenty of wars going on around the world. Ukraine and Gaza are just a few of the hot spots that have been in the news over the past few years. Now we have started a new war, only it does not involve guns – unless you are purchasing them. The tariff wars are raging and though the rhetoric originates from our country, the effects are likely to be witnessed in every corner of the globe. And we expect that some countries will be affected more deeply than others.
In America, some industries will love the tariffs. For example, our shrimping industry has been decimated by overseas competition. Of course, the leveling of the playing field is likely to mean higher prices for consumers. Other industries are dead set against tariffs. This includes the homebuilding industry, where March lumber prices hit their highest levels in two and a half years. In an economy in which home prices are already at record levels, higher lumber prices will likely help make homes even less affordable.
Where will this all lead? The results could lead us in a few different directions. Perhaps negotiations limit the effects of tariffs and life goes on. Or higher prices could cause a slowdown in our economy. As we have mentioned previously, a tariff-induced economic slowdown could cause interest rates to fall. Significantly lower interest rates would boost home affordability more than higher lumber prices would hurt home affordability. In turn, that would boost the economy. As always, we will have to wait until these scenarios play out.
Source: Origination Pro
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