What do rising tariffs and bond market volatility have to do with buying or selling a home in Los Angeles? As it turns out—plenty.

Let’s start with the basics: a tariff is a tax on goods imported into the United States. The idea is to level the playing field between inexpensive foreign-made products and more costly U.S.-made goods. But the reality? American consumers often absorb the brunt of these tariffs through higher prices—including on construction materials like Canadian lumber, imported appliances, and other building essentials.

So, how does that connect to the Los Angeles housing market?

If sweeping Trump tariffs are enacted, the cost of building new homes could rise significantly. That means new construction in L.A.—already expensive—could become even pricier. And it’s not just new homes. If you’re remodeling, replacing a refrigerator, or installing new flooring, you might feel the impact too.

Right now, we haven’t seen massive changes just yet—but we’re definitely in a wait-and-see phase. Tariffs are being discussed more as a negotiating tactic than an immediate policy. Still, if you’re thinking about buying a new home or renovating, this might be a smart time to act before prices potentially spike.

But there’s another piece to this puzzle that gets less attention: the bond market.

Bond yields—especially the 10-year Treasury yield, which mortgage rates closely follow—have been climbing. And as bond yields go up, so do mortgage rates. Why? A drop in demand for U.S. bonds from foreign and domestic investors pushes bond prices down and yields up. This makes borrowing more expensive, hitting homebuyers directly in their monthly mortgage payments.

We’ve recently seen mortgage rates tick up again after briefly dropping to the low 6s. This short-term dip gave the market a jolt of energy—but now that rates are closer to 7%, it’s putting pressure back on affordability. Especially in markets like Southern California, where homes under $1.3 million remain in high demand, that rate jump matters.

So what should you do if you’re buying or selling?

If you’re a homebuyer in Los Angeles, check in with your lender now—don’t rely on pre-approvals from a few weeks ago. Interest rates move fast, and your buying power could shift with just a half-point change.

If you’re a home seller, recognize that buyers are recalculating in real time. If they were approved at 6.5% but now face 7.25%, they may hesitate or offer less. Understanding this dynamic can help you price and position your home more effectively.

Bottom line? We’re navigating a market shaped by uncertainty—tariffs, bond yields, and rising mortgage rates all play a role. But amid the noise, real estate is still moving.

If you’re financially ready and the numbers make sense for you, that’s what truly matters.

Questions about how this could impact your buying or selling strategy? Let’s talk. I’m Scott Himelstein with the Scott Himelstein Group, your Los Angeles realtor!