Markus Andrews

There are signs that the housing market is swinging to favor buyers. But renewed worries about the economy are holding some buyers back.
“A lot of it is coming from the White House,” said Chen Zhao, an economist at Redfin.
Here’s what to know if you’re house hunting.

monkeybusinessimages | Getty

There are signs that the housing market is swinging to favor buyers. However, renewed worries about the economy are holding some buyers back.
On the upside for homebuyers, home price growth has slowed and mortgage rates have retreated from recent peaks.

The median sale price for homes was $375,475 in the four weeks ending February 16, up 3.7% from a year prior, according to Redfin, a real estate brokerage firm. That is the smallest increase in nearly five months.
Meanwhile, the average 30-year fixed rate mortgage inched down to 6.87% the week ending Feb. 13, per Freddie Mac data. That’s the lowest so far in the year, and down from the latest peak of 7.04% in January.
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However, “buyers are still faced with this massive affordability challenge,” said Orphe Divounguy, a senior economist at Zillow.
Mortgage applications for the week ending February 14 fell 6.6% from a week earlier, according to data from the Mortgage Banker’s Association. Experts forecast January home sales data — set to come out Friday — to show a decline.

On top of relatively high costs, some buyers could be having second thoughts as uncertainty about the broader economy creeps in, according to Chen Zhao, an economist at Redfin.
“A lot of it is coming from the White House,” she said of the reasons that have buyers worried.

Promising signs in the housing market

Some factors in the housing market are giving buyers more room to negotiate prices, according to experts. 
For one, inventory is growing as more owners put their homes up for sale. With more options available, buyers have “a little bit more bargaining power in the market,” Divounguy said. 
According to Redfin data, there were 564,642 new home listings in January, up 1.9% from a month prior and 4.7% higher from a year earlier. New home listings hit the highest level since July 2022.

Some home sellers are cutting their asking prices, too. The typical home is selling for 2% less than its asking price, the biggest discount in two years, per Redfin data.

Buyers worry about the economy, job loss

Some buyers are rethinking their plans given broader economic uncertainty, experts say.
As of mid-February, thousands of workers across multiple federal agencies and departments have been laid off as part of President Trump’s aim to reduce the government workforce.
This can make people who either work directly with the government or are connected through contract work or federal funding “nervous that there could be big changes on the horizon,” Zhao said.
“They are worried about job security,” said Zhao, which takes a home purchase off the table.
“The first thing you might do is hold off on a really big purchase because you’re worried about financial security,” she added.

A lot of it is coming from the White House.

head of economics research at Redfin

The anxiety doesn’t stop there — the possibility of trade wars and drastic changes in government spending may leave Americans wondering “what’s next?” Zhao explained.
Trump signed a presidential memorandum laying out his plan to impose “reciprocal tariffs” on foreign nations. The plan allows the U.S. to treat other countries’ non-tariff policies as unfair trade practices that warrant tariffs in response.
For consumers, the prospect of higher prices on everyday items and the potential for inflation to accelerate may make them hesitate to invest in a new home.

How to navigate the buyers’ market

If you’ve been in the market for a while and you see a house that you really like, try to negotiate hard on the price and see where it goes, Zhao said.
If the home seller isn’t open to lowering the asking price, see if they can cover additional expenses like closing costs or to pay for the buyer’s real estate agent fees.

Those can be valuable concessions.
Closing costs can run between about 2% and 6% of the loan amount, according to NerdWallet. If you take out a $300,000 mortgage, you could pay from $6,000 to $18,000 in closing costs on top of the down payment.
The average buyer’s agent commission was 2.37% for homes sold in the fourth quarter of 2024, down from 2.45% a year prior, per a data analysis by Redfin. 
If not, check out the new builds market — some builders are offering incentives like “in-house lending” and often provide favorable loan terms like lower rates, experts say. More

Americans are racking up more credit card debt, but at a slower pace than they were before.
The average consumer’s credit card balance is now $6,580, a new report by TransUnion found.
For borrowers with a revolving balance, here are the best payoff strategies.

Americans are racking up more and more credit card debt.
Collectively, consumers owe a record $1.21 trillion on their credit cards, the Federal Reserve Bank of New York recently reported.

The average balance per consumer now stands at $6,580, up 3.5% year over year, according to a separate quarterly credit industry insights report from TransUnion.
Despite the uptick, the rate of change has slowed considerably, said Charlie Wise, TransUnion’s senior vice president of global research and consulting. “Consumers are still continuing to use their credit cards, but the amount they are leaning on them seems to be declining.”

In the wake of the pandemic, higher prices and high interest rates put many households under pressure and prices are still rising, albeit at a slower pace than they had been.
The consumer price index — a key inflation barometer — has fallen gradually from a 9.1% pandemic-era peak in June 2022 to 3% in January. but is still above the Federal Reserve’s 2% goal.
The central bank cut its benchmark rate by a full percentage point in the second half of 2024, but policymakers have been advocating a more cautious pace ahead as they evaluate the overall strength of the labor market and President Donald Trump’s policy ramifications.

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According to meeting minutes released Wednesday, Federal Reserve officials agreed they would need to see inflation come down more before lowering interest rates further, and expressed concern about the impact tariffs may have.
In the meantime, households have largely adjusted to a new normal of high prices and high rates, Wise said: “We’re seeing a bit less of a reliance on credit cards to make ends meet.” After balances soared in 2022 and 2023, the growth in credit card debt has slowed considerably, he said.
Credit card delinquency rates, or those 90 days or more past due, fell year over year for the first time since 2020, TransUnion also found. “This is a good sign,” Wise said.

How to get out of credit card debt

“While most people are generally doing okay, the truth is that many, many Americans are a job loss, medical emergency or some other big, unexpected event [away] from being in a world of hurt,” said Matt Schulz, chief credit analyst at LendingTree and the author of “Ask Questions, Save Money, Make More.”
“It wouldn’t take much for them to go from pretty good to pretty dicey,” he said.
Credit cards are still one of the most expensive ways to borrow money after the Federal Reserve’s string of interest rate hikes lifted the average credit card rate to more than 20% — near an all-time high.
Even as the Fed lowered its benchmark at the end of last year, the average credit card rate barely budged.

“The good news is that there are plenty of options to help you pay down card debt,” Schulz said.
Rather than wait for a modest adjustment in the months ahead from further Fed rate cuts, borrowers could call their card issuer now and ask for a lower rate, switch to a zero-interest balance transfer credit card or consolidate and pay off high-interest credit cards with a personal loan, Schulz advised.
“If you’re really struggling, an accredited nonprofit credit counselor can make a huge difference,” he said. “Doing nothing, however, is not an option. It’ll only make things worse.” 
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There’s a special tax break, known as the Section 121 exclusion, that shields part of your home sales profit from capital gains taxes.
The limits are up to $250,000 for single filers and $500,000 for married couples filing jointly but you must meet IRS rules.
Renting out your home could reduce or eliminate the exclusion, experts say.

Busà Photography | Moment | Getty Images

Capital gains ‘exclusion’ for your home

That tax surprise stems from a special tax break, known as the “Section 121 exclusion,” that shields part of your primary home sales profits from capital gains taxes. The limits are up to $250,000 for single filers and $500,000 for married couples filing jointly.
To qualify for the exclusion, you must meet the IRS ownership and use tests, which require that you owned the home and used it as your primary residence for 24 months of the past five years, with some exceptions. The 24 months of residency, however, don’t have to be consecutive.
You’re generally eligible if you didn’t claim the exclusion for another property within two years before the sale.

Any home sale profit above those thresholds could be subject to 0%, 15% or 20% capital gains taxes, depending on your taxable income. You also could owe net investment income tax of 3.8%, depending on your other investment earnings.
You can reduce your profit by increasing your “basis,” or the home’s original purchase price, by tacking on so-called capital improvements and other expenses.

Landlords may only get ‘a portion of the exclusion’

However, “if you’re renting the home, you’re only going to get a portion of the exclusion,” said Mark Baran, managing director at financial services firm CBIZ’s national tax office. 
For example, if you make $250,000 profit selling your home but rented out the property for three out of the past five years, you would only receive two-fifths of the $250,000 exclusion, or $100,000.
That leaves $150,000 of profit that could be subject to capital gains taxes before any adjustments to the home’s basis.
Alternatively, you could still be eligible for the full $250,000 exclusion if you met the ownership and use tests but didn’t rent out the property, Baran said. More

President Donald Trump’s order pausing all U.S. foreign aid put many charities in jeopardy.
In some cases, individual donors can bridge some of the funding gap.
Here is a list of highly rated nonprofits that have been affected by the freeze on foreign assistance. 

President Donald Trump’s order to suspend all U.S. foreign aid, which was announced on January 20, is currently on hold amid a legal review.
But for nonprofits, charities and public service organizations that rely on federal funding, some damage has already been done.

“Foreign assistance programs don’t operate with an on/off switch,” said Mitchell Warren, executive director of the AIDS Vaccine Advocacy Coalition, which provides HIV prevention resources worldwide.
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About 30% of the overall nonprofit sector’s revenues come from government grants and contracts, according to Diane Yentel, president and CEO of the National Council of Nonprofits, which brought a suit against the federal funding freeze resulting in a temporary restraining order. 
“The temporary restraining order preventing the administration from freezing all federal funding has had a positive effect, with many nonprofit organizations previously unable to access funds to continue their vital work now able to do so,” Yentel said.
However, “some federal agencies continue to make expected funding unavailable, and many nonprofits — especially the smallest among them, with the least resources to fall back on if a federal payment doesn’t come through — are having to make difficult decisions to furlough or lay off staff, or to close programs entirely,” Yentel said.

A worker removes the U.S. Agency for International Development sign on their headquarters on Feb. 7, 2025 in Washington, DC.
Kayla Bartkowski | Getty Images

Trump’s foreign aid freeze and the shutdown of the U.S. Agency for International Development is part of a larger effort to shrink the federal bureaucracy.
Backed by the Trump administration, Elon Musk and his advisory group known as the Department of Government Efficiency said dismantling the USAID is a first step.
“We spent the weekend feeding USAID into the wood chipper,” Musk wrote on his social media platform X on Feb. 3.
Most Americans support foreign aid. A 2024 poll by the Reagan Institute found that 54% of Americans believe the U.S. should be more involved in international affairs, while 33% want less U.S. engagement. Even more — 77% — said the U.S. has a moral obligation to stand up for human rights and democracy around the world.

‘Now is the time to dig deep’

The freeze on foreign assistance funding sent “a shock wave through the nonprofit sector,” said Michael Thatcher, the CEO of nonprofit evaluator Charity Navigator.
Many international organizations operate with less than 100 days of working capital, according to Thatcher, which means “this is going to change their ability to pay their staff and maintain operations,” he said. “About half may not survive.”
In some cases, individual donors can bridge some of the funding gap, Thatcher said. “If some of these causes are things you care deeply about, now is the time to dig deep.”
In fact, foreign assistance only comprises about 1% of the federal budget — or roughly $63 billion in fiscal year 2023 — and less than 0.33% of gross domestic product, according to a Brookings Institution report from September. By comparison, U.S.-based institutions and individual donors contributed about $49.3 billion to overseas causes as of a 2020 tally.

Where to give

“Individual givers and philanthropy on a larger scale has a really important role right now,” said Michael Jarvis, executive director of the Trust, Accountability, and Inclusion Collaborative, a Washington, D.C.-based network of funders that operate around the world.
“There’s no way that private givers can fill the gap that the U.S. government is leaving,” Jarvis said, “but it means that their funds are all the more important and needs to be strategically deployed even more effectively.”
To that end, Charity Navigator compiled a list of highly rated nonprofits that were affected by the funding freeze on foreign assistance, including Save the Children and UNICEF, among others. 
Individual giving “is already an important player and I do think people will step up more now,” Jarvis said. “There are ways people can use their voice effectively and certainly use their money effectively.”
There may even be a tax benefit, depending on how those donations are made.
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Amid efforts to cut wasteful federal spending, billionaire Elon Musk recently turned his focus to people over age 100 receiving Social Security benefits.
Yet some experts say it’s unlikely there’s massive benefit fraud among that age cohort.

Elon Musk speaks as one of his young sons and President Donald Trump listen in the Oval Office of the White House in Washington, D.C., Feb. 11, 2025.
Kevin Lamarque | Reuters

As Elon Musk continues to look for ways to cut federal spending through the Department of Government Efficiency, he has raised questions as to just how long some Social Security beneficiaries have been receiving payments.
With a “cursory examination” of Social Security, “we’ve got people in there that are 150 years old now,” Musk said during a Feb. 11 CNN interview.

In recent days, he re-upped those claims on social media platform X. “Maybe Twilight is real and there are a lot of vampires collecting Social Security,” Musk posted on Feb. 16.
Just because the Social Security Administration has millions of people in its database who are very elderly and not marked as deceased does not necessarily mean benefits are fraudulently being paid, said Alex Nowrasteh, vice president for economic and social policy studies at the Cato Institute, a public policy research organization.
“The amount of fraud is likely miniscule,” Nowrasteh said.

When asked for comment, the White House provided an email statement from Press Secretary Karoline Leavitt citing a 2024 investigation that found the Social Security Administration made about $71.8 billion in improper payments out of almost $8.6 trillion in benefits paid from fiscal years 2015 to 2022.
Notably, deceased beneficiaries were one of multiple reasons that may prompt improper payments, according to the report from the Social Security Administration Office of the Inspector General.

“The Social Security Administration is now working to find even more waste, fraud and abuse in the Administration’s whole-of-government effort to protect American taxpayers,” Leavitt said in the emailed statement.
This week, acting Social Security commissioner Michelle King stepped down over reported concerns over DOGE access to sensitive data at the agency. In a new statement released Wednesday, Lee Dudek, who is now acting commissioner, said the agency plans to prioritize transparency and protect benefits and information.
“The reported data are people in our records with a Social Security number who do not have a date of death associated with their record,” Dudek said. “These individuals are not necessarily receiving benefits.”
The Social Security Administration did not respond to requests for further comment.

Data doesn’t influence benefit payments, expert says

In recent days, Musk has shared data on the numbers of Social Security beneficiaries by age on X. Experts say the data likely came from the Social Security Administration’s electronic file of personally identifiable information on everyone with a Social Security number, known formally as Numident.
Numident is an electronic file that has personally identifiable information — such as name, date of birth and other details — for every individual who has been issued a Social Security number, according to a 2023 Social Security Office of the Inspector General report focused on Social Security number holders ages 100 and up.
The Social Security Administration inputs death information it receives from various sources on Numident, according to the report. From there, the agency uses Numident to create a full file of death information, the Death Master File, that is shared with other agencies that pay benefits to help prevent and detect fraud.
In the 2023 report, the Office of the Inspector General found about 18.9 million Social Security number holders were born in 1920 or earlier and had no death information on their Numident records. However, Census Bureau data estimates at the time of the review showed only about 86,000 individuals living in the U.S. were age 100 or older.

If a death is not properly recorded, that can interfere with efforts to prevent and identify fraud by both federal and private entities, the OIG report said.
Just because Numident records are out of date doesn’t influence the Social Security Administration’s payments, according to a former Social Security Administration employee.
“The payment records that send 70 million checks payments a month aren’t driven by the Numident,” the former Social Security Administration employee said. “To correlate the two is just manipulative.”

For decades, the agency had reached out to beneficiaries who are over 100 years old, who have not recently used Medicare, to verify their identities, the former Social Security employee said.
“To say, ‘Oh, well, there’s 150-year-old people,’ that’s just silly,” the former Social Security Administration employee said. “That particular operation over the years did yield cases where there was fraud being committed, but not a lot of it.”

Undocumented immigrants pay into program

Individuals over age 100 are more susceptible to having their Social Security numbers fraudulently used by undocumented immigrants for work rather than having their benefits stolen, Nowrasteh said.
“A good number of these Social Security numbers are being used by illegal immigrants to work and pay taxes,” Nowrasteh said.
Importantly, that likely means more money coming into Social Security through payroll taxes than leaving the program through benefit payments, according to Nowrasteh.
In tax years 2016 to 2020, employers and individuals received about $8.5 billion in wages, tips and self-employment income from 139,211 Social Security numbers attributed to individuals ages 100 and up, according to the 2023 SSA OIG report that looked at number holders ages 100 and up.
“Probably zero of them are working,” Nowrasteh said of the data. Instead, that revenue into the program is likely coming from undocumented workers who won’t receive benefits, he said.
“Because they’re illegal immigrants, they don’t have access to the benefits on the back end when they retire,” Nowrasteh said.
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Immigrants consumed 21% less welfare and entitlement benefits than native born Americans per capita, or per person, as of 2022, according to new research Nowrasteh co-authored.
If the administration cracks down on payroll taxes coming into Social Security using false numbers, “then it might actually worsen the fiscal soundness of the program and make it insolvent sooner,” Nowrasteh said.
The Social Security Administration relies on ongoing payroll taxes to pay benefits. To supplement those payments, the agency also draws from money set aside in trust funds. Because those trust funds are running low, just 83% of both retirement and disability benefits may be payable starting in 2035, Social Security’s trustees projected last year.
It remains to be seen whether Congress will act sooner to prevent those changes. More

When selling your main home, there’s a tax break that shields up to $250,000 of profits for single filers and $500,000 for married couples filing jointly. But you need to meet certain rules.
An increasing number of home sellers are exceeding those thresholds, according to a 2024 report from CoreLogic.
However, it’s possible to increase your “basis,” or the home’s original purchase price, to reduce your gain, experts say.

Martin Barraud | Ojo Images | Getty Images

As U.S. home equity climbs, owners are more likely to face capital gains taxes from selling property. But a lesser-known tax strategy could help shrink your bill, experts say.
When selling your main home, there’s a special tax break that shields up to $250,000 of profits for single filers and $500,000 for married couples filing jointly. However, you need to meet certain rules.

An increasing number of home sellers are exceeding those thresholds, according to a 2024 report from real estate data firm CoreLogic. Nearly 8% of U.S. homes sold in 2023 exceeded the capital gains tax limit of $500,000 for married couples, up from about 3% in 2019, the report found.
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Those percentages were even higher in high-cost states like Colorado, Massachusetts, New Jersey, New York and and Washington, according to the CoreLogic report.  
Exceeding the $250,000 and $500,000 exclusions is “becoming more common,” said Tommy Lucas, a certified financial planner and enrolled agent at Moisand Fitzgerald Tamayo in Orlando, Florida.
Home sale profits above the $250,000 or $500,000 thresholds are subject to capital gains taxes of 0%, 15% or 20%, depending on your taxable income.

Increase your ‘basis’ to reduce profits

Many home sellers don’t realize they can reduce capital gains by increasing their “basis,” or the home’s original purchase price, according to Mark Baran, managing director at financial services firm CBIZ’s national tax office. 
You can increase your basis by adding “capital improvements,” such as renovations, adding a new roof, exterior upgrades or replaced systems.  
Your “adjusted basis” is generally the cost of buying your home plus any capital improvements made while you own the property.
“That adds up over time and can bring them fully within the [$250,000 or $500,000 capital gains] exclusion,” Baran said.
However, you cannot add home repairs and maintenance, such as fixing leaks, holes, cracks or replacing broken hardware, according to the IRS.

You also can reduce your home sale profit by adding fees and closing costs from the purchase and sale of the home, according to Lucas.
The IRS says some of these expenses could include:

Title fees
Charges for utility installation
Legal and recording fees
Surveys
Transfer taxes
Title insurance
Balances owed by the seller

“Maybe that gets you an extra few thousand” to reduce the profit, Lucas added. More

A U.S. appeals court blocked the Biden administration’s student loan relief plan known as SAVE.
The move will likely lead to higher monthly payments for millions of borrowers.

Former U.S. President Joe Biden speaks about student loan debt relief at Madison Area Technical College in Madison, Wisconsin, on April 8, 2024.
Andrew Caballero-Reynolds | AFP | Getty Images

A U.S. appeals court on Tuesday blocked the Biden administration’s student loan relief plan known as SAVE, a move that will likely lead to higher monthly payments for millions of borrowers.
The 8th U.S. Circuit Court of Appeals sided with the seven Republican-led states that filed a lawsuit against the U.S. Department of Education’s plan. The states had argued that former President Joe Biden lacked the authority to establish the student loan relief plan.

The GOP states argued that Biden, with SAVE, was essentially trying to find a roundabout way to forgive student debt after the Supreme Court blocked his sweeping debt cancellation plan in June 2023.
SAVE, or the Saving on a Valuable Education plan, came with two key provisions that the lawsuits targeted. It had lower monthly payments than any other federal student loan repayment plan, and it led to quicker debt erasure for those with small balances.
Implementing SAVE could cost as much as $475 billion over a decade, an analysis by the University of Pennsylvania’s Penn Wharton Budget Model found. That made it a target for Republicans, who argued that taxpayers should not be asked to subsidize the loan payments of those who have benefited from a higher education.
However, consumer advocates say most families need to borrow to send their children to college today and that they require more affordable ways to repay their debt. Research shows student loans make it harder for people to start businesses, buy a house and even have children.
The court’s ruling comes at the same time that House Republicans are floating proposals that could raise federal student loan bills for millions of borrowers.

The average student loan borrower could pay nearly $200 a month more if the GOP’s plans to reshape student loan repayments succeed, according to an early estimate by The Institute for College Access & Success. Republican lawmakers want to use the extra revenue to fund President Donald Trump’s tax cuts.
How will the end of the SAVE plan affect you financially? If you’re willing to share your experience for an upcoming story, contact me at annie.nova@nbcuni.com.

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