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Los Angeles real estate agent, Scott Price, recently experienced a rare occurrence in his 20-year career: a buyer backing out of a deal just two days before closing. The reason was the buyer's growing unease with the economy due to potential layoffs. This is not an isolated incident; data from Redfin shows that over 14% of home purchase agreements in the US were canceled between March 17 and April 13, the highest level for this time of year since 2020.

    Economists warn that President Donald Trump's tariffs may lead to price hikes and a potential recession. Real estate agents report feeling the effects of economic uncertainty already. Homebuying in 2025 has been slow, with sales of previously owned homes dropping 5.9% in March from the prior month, according to the National Association of Realtors.

    Realtor Maddy Mixter notes that first-time homebuyers are being cautious due to recession fears and a stock market sell-off that has reduced their savings. "People are kind of taking a step back or being really cautious in their moves in the real estate market," she said. Mortgage rates have also increased, with the average rate on a 30-year fixed mortgage experiencing its largest one-week jump in nearly a year.

    Certified financial planner Douglas Boneparth advises waiting to make large purchases like new homes when finances are uncertain. He suggests being more conservative with investments and ensuring savings aren't exclusively invested in stocks. Tariffs on imported construction goods and appliances have also impacted the spring home market, making buyers think twice about purchasing fixer-upper homes.

    Some first-time homebuyers are opting for move-in-ready homes due to uncertainty, while others see real estate as a sound investment alternative amid market gyrations. However, this trend may not be widespread, and the impact of Trump's tariffs on the housing market remains to be seen.