Buyer Demand Looks Bleak Despite Early April Uptick

Homebuyers jumped at cooling borrowing costs at the beginning of the month, but long-term demand is looking bleak.

A Redfin analysis of pending home sales and mortgage applications revealed marked improvements in homebuyer demand at the beginning of the month.

But President Trump’s tariff policies, mortgage rates, and the increased odds of a recession have likely pushed down buyer sentiment. 

Redfin says pending home sales saw their smallest decline since the start of 2025, down 1.1% YOY during the week ending April 4. Mortgage applications also rose, seeing a 9% boost.

This week’s numbers are set to look very different. At the beginning of April, rates sank immediately following Trump’s tariff announcement. In the last few days, however, rates shot up to nearly 7% as investors shed U.S. Treasury Bonds.

Trump’s pause on some tariffs has pulled rates back down, but economists worry the damage has already been done.

JPMorgan Chase CEO Jamie Dimon told Fox News that the U.S. economy is likely headed toward a recession.

“Markets aren’t always right, but sometimes they are right,” he said. “I think this time they are right because they’re just pricing uncertainty [at] the macro level and uncertainty [at] the micro level, at the actual company level, and then how it affects consumer sentiment. It’s hard to tell.”

Some analysts are pointing out one concern for the housing market in particular: mortgage-backed securities. China is one of the largest holders of these securities and could deal a serious blow to the spring housing market by unloading them.

“If China wanted to hit us hard, they could unload Treasuries. Is that a threat? Sure it is,” Guy Cecala, executive chair of Inside Mortgage Finance, told NBC. “They’re going to look at pushing levers and trying to put pressure… Targeting housing and mortgage rates is a powerful driver of something like that.”