President Donald Trump’s second-term trade policies are shaking up the market in ways that landlords, developers and homebuyers can’t afford to ignore. From surging rents to stalled construction projects, the impact of tariffs is rippling through the industry. The uncertainty surrounding Trump’s tariffs and economic policies is pushing potential homebuyers to the sidelines, and that hesitation is driving rental prices to record highs.
In New York City, Manhattan’s median rent hit a fresh high of $4,500 in February — its highest level since 2023. Brooklyn and Queens are feeling the pressure too, with Brooklyn rents averaging over $4,000 and Northwest Queens surpassing $3,400.
Chicago isn’t far behind. Downtown apartment rents just broke the $3,000 threshold for the first time ever, and with supply cratering due to high construction costs, developers are holding back — meaning rents are only expected to spike further in 2025.
Tenants are afraid to take the plunge into homeownership amid fluctuating mortgage rates and economic instability. The result is lower vacancy rates, more bidding wars and landlords with the upper hand. With summer around the corner, expect even higher rents in the months ahead.
While mortgage rates have dipped since Trump’s return to the White House, experts say the unpredictability surrounding his tariffs is outweighing any potential savings — causing some renters who once considered buying to think again.
The outlook for new homes isn’t any rosier, and homebuilders are scrambling. Trump’s tariffs on steel, aluminum and lumber imports are driving up costs, forcing builders to get creative. Some are stockpiling materials, gambling that today’s prices are better than what’s to come. Others are shrinking floor plans or pivoting to modular construction. The National Association of Home Builders estimates these tariffs could add $7,500 to $10,000 to the cost of a new home. And in places like California, where developers are already dealing with fire recovery costs, the added expense could mean the difference between rebuilding and walking away from projects altogether.
While Trump’s unpredictability has long been a hallmark of his economic policy, the former Cantor Fitzgerald head’s mixed messaging is keeping investors and industry players on edge.
In Texas, where industrial development has been booming, big players like Ross Perot Jr. are considering baking “tariff clauses” into contracts to prepare for rising costs. Meanwhile, Citadel founder Ken Griffin isn’t mincing words — calling Trump’s trade policies a “huge mistake” that could cripple the economy. Huge mistake or not, the uncertainty and chaos surrounding Trump’s tariffs is certainly making it difficult to stay ahead of the curve.
For most home buyers, the purchase of real estate is one of the largest financial transactions they will make. Buyers purchase a home not only for the desire to own a home of their own, but also because of changes in jobs, family situations, and the need for a smaller or larger living area. This annual survey conducted by the NATIONAL ASSOCIATION OF REALTORS® of recent home buyers.
First-time buyers decreased to 24% of the market share (32% last year). This year now marks the lowest share since NAR began collecting the data in 1981.
The median first-time buyer age increased to 38 years old this year from 35 last year, while the typical repeat buyer age also increased to 61 years from 58 last year.
62% of recent buyers were married couples, 20% were single females, 8% were single males, and 6% were unmarried couples.
73% of recent buyers did not have a child under the age of 18 in their home. This is the highest share recorded.
17% of home buyers purchased a multigenerational home, for cost savings (36%), to take care of aging parents (25%), because of children or relatives over the age of 18 moving back home (21%, and children over the age of 18 who never left home (20%).
83% of buyers were White/Caucasian, 7% were Black/African-American, 6% were Hispanic/Latino, 4% were Asian/Pacific Islander, and 3% identified as some other race.
88% of recent home buyers identified as heterosexual, 3% as gay or lesbian, 2% as bisexual, 1% prefer to self-describe, and 6% preferred not to answer.
16% of recent home buyers were veterans and 2% were active-duty service members.
At 22%, the primary reason for purchasing a home was the desire to own a home of their own. For first-time buyers, this number jumps to 64%.
15% of buyers purchased a new home, and 85% of buyers purchased a previously-owned home.
Recent buyers who purchased new homes were most often looking to avoid renovations and problems with plumbing or electricity at 42%. Buyers who purchased previously-owned homes considered them a better value at 31%.
Detached single-family homes continued to be the most common home type for recent buyers at 75%, followed by townhouses or row houses at 7%.
Senior-related housing remained at 19% of buyers over the age of 60 this year. 58% purchased a detached single-family home, and 52% bought in a suburb or subdivision.
The median distance between the home that recent buyers purchased and the home they moved from was 20 miles. This is down from the 2022 report of 50 miles but remains elevated from the distance of 15 miles seen from 2018 to 2021.
Quality of the neighborhood (59%), convenience to friends and family (45%) and overall home affordability (36%) remained the most important factors to recent home buyers when choosing a neighborhood.
Buyers typically purchased a home that was built in 1994. This is a rebound after the last two years, when buyers typically purchased a home built in the 1980s.
Overall, buyers expected to live in their homes for a median of 15 years, while 25% said that they were never moving.
In 2024, the home buying process for many started online, with 43% of buyers indicating that their first step was to look for properties on the internet. Additionally, 21% of buyers reached out to a real estate agent as their initial action.
Real estate agents played a crucial role, with 86% of all buyers utilizing their services—the highest of all information sources used.
Buyers spent a median of 10 weeks searching for a home in 2024, typically viewing seven homes, and two of those homes were viewed online only.
All home buyers used the internet to search for a home. The most valuable content on websites were photos (41%), detailed information property information (39%), and floor plans (31%).
59% of recent buyers reported being very satisfied, and 33% expressed being somewhat satisfied with their recent home buying process.
88% of home purchases were made through a real estate agent or broker, demonstrating the continued importance of agents in the home buying process. 5% of buyers purchased directly from a builder or builder’s agent, and 5% purchased directly from the previous owner.
Home buyers primarily sought help from an agent or broker in finding the right home to purchase (49%) and negotiating the terms of the sale (14%).
40% of buyers found their agent through a friend, neighbor, or relative. This trend was especially pronounced among first-time buyers, where 51% relied on referrals from their personal network.
Most buyers only interviewed one agent before making a decision, with 77% of repeat buyers.
88% of home buyers would use their agent again or recommend to others.
74% of all buyers financed their home purchase, a decrease from 80% last year. First-time buyers were more likely to finance their purchase at 91%, while only 69% of repeat buyers financed.
26% of home buyers paid cash for their home, an all-time high for all-cash buyers.
49% of recent home buyers used their savings to finance their home purchase, down from 54% last year. 25% of first-time buyers used a gift or loan from a relative or friend for their downpayment, though savings was most common at 69%.
52% of first-time buyers utilized a conventional loan to finance their home, 29% used an FHA loan, and 9% used a VA loan. The share of first-time buyers using an FHA loan has declined from 55% in 2009 to 29% in 2024.
Buyers continue to see purchasing a home as a good financial investment. 79% reported believing that a home purchase is a good investment, and among those buyers, 39% said it was better than owning stocks.
The typical age of home seller was 63 this year, the highest ever recorded.”
For all sellers, the most commonly cited reason for selling their home was the desire to move closer to friends and family (23%), followed by home was too small (12%), home was too large (11%), and the neighborhood was becoming less desirable (10%).
The median number of years a seller owned their home was 10 years, the same as last year. That number was higher than reported from 2000 to 2008, when the tenure in the home was only six years.
36% of sellers traded up and purchased a home that was larger in size than what they previously owned, 30% bought a home that was similar in size, and 32% traded down and purchased a home that was smaller in size.
For recently sold homes, the final sales price was a median of 100% of the final listing price. This continues to be the highest recorded median since 2002.
For all sellers, time on the market this year was a median of three weeks, one week longer than last year.
68% of sellers were very satisfied with the selling process. 22% were somewhat satisfied.
66% of recent sellers used an agent that was referred to them or used an agent they had worked with in the past to buy or sell a home.
81% of recent sellers contacted only one agent before finding the right agent they worked with to sell their home.
50% of sellers used the same real estate agent to represent them when purchasing or selling their home. That number jumps to 71% for sellers within 10 miles of their home purchase.
Sellers place a high priority on the following three tasks: help market the home to potential buyers (22%), price the home competitively (20%), and sell the home within a specific timeframe (18%).
The real estate agent’s reputation remains the most important factor when sellers select an agent to sell their home (35%), and an agent’s trustworthiness and honesty (21%).
Most sellers—87%—said that they would definitely (72%) or probably (15%) recommend their agent for future services.
90% of sellers sold with the assistance of a real estate agent, up from 89% last year, and only 6% were FSBO sales. The share of FSBO sellers was a historical low.
For 38% of all FSBO sellers, the main reason to sell via FSBO was because they sold to a relative, friend, or neighbor.
Getting the price right (17%), selling within the length of time planned (13%), and understanding and performing the paperwork (10%) were the most difficult steps for FSBO sellers.
FSBOs typically sell for less than the selling price of other homes; FSBO homes sold at a median of $380,000 in 2023 (up from 310,000 in 2022), still far lower than the median selling price of all homes, which was $435,000.
