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    Actively managed ETFs hit $1 trillion milestone: Why tariff uncertainty may spark more growth

    It’s milestone month for the exchange-traded fund industry.
    Actively managed ETFs now have more than $1 trillion in assets under management, according to independent research firm ETFGI.

    That’s roughly the market cap of Berkshire Hathaway, Saudi Arabia’s gross domestic product and the value of 121 New York Yankees franchises.
    The ETF Store’s Nate Geraci thinks it will grow even bigger due to the appetite for new active investing strategies.
    “It’s interesting for an industry where the roots are passively managed products. That’s what the industry was built on,” the firm’s president told CNBC’s “ETF Edge” this week. “It’s interesting to see active ETFs getting all of the attention right now.”
    Geraci finds most of the flows are going into “much more systemic strategies,” including a combination of passive and aggressive.  
    “When you look at the growth in the number of actively managed ETFs out there … these aren’t what you necessarily think of as traditional active,” he added. “It is products like options-based income ETFs [and] buffer ETFs.”

    Actively managed ETFs now comprise almost one-tenth of the ETF industry, according to VettaFi’s Kirsten Chang.

    Tariffs and market volatility implications

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    China’s cities may see ‘flying taxis’ as soon as three years, aviation company Ehang predicts

    Ehang earlier this week said it was the first in the world to obtain a certificate for operating a pilotless aerial vehicle that can carry humans.
    The certification clears the way for flying taxis to become a viable method of transportation in some Chinese cities over the next three to five years.
    Analysts and researchers say the certification shows how China is a leading innovator in the future of transportation and mobility.

    A flying taxi displayed at the China Telecom booth at SNIEC in Shanghai, on June 26, 2024, during the opening of Mobile World Congress 2024.
    Nurphoto | Nurphoto | Getty Images

    Flying taxis will become a viable method of transportation in China in the next three to five years, according to a senior executive at Ehang, a company that makes autonomous aerial vehicles (AAVs).
    The prediction by Ehang’s Vice President He Tianxing comes days after the company became the first company, along with its joint venture partner Hefei Heyi Aviation, to obtain a certificate to operate “civil human-carrying pilotless aerial vehicles” from the Civil Aviation Administration of China.

    Ehang said the certification clears the way for commercial operations of its vehicles, allowing for paid human-carrying services and any other low-altitude use cases the company develops.
    At first, Ehang’s AAVs will be used for tourism, with passengers able to ride along designated routes in Guangzhou and Hefei by the end of June, He told CNBC in an interview translated from Mandarin.
    The company will gradually explore air taxi services as its tourist operations progress. He named Hefei and Shenzhen as examples of some of the first cities expected to get air taxi services.
    Ehang’s EH216-S, which received the certification, is a fully electric, pilotless two-seater aerial vehicle that features 16 propellers, according to Ehang’s website. It has a maximum design speed of 130 kilometers per hour, with a maximum range of 30 kilometers.
    He expects to get certifications to operate in additional cities this year and next, with the second set of locations for tourist operations expected to include Zhuhai, Shenzhen, Taiyuan, Wuxi, Wenzhou and Wuhan.

    For the forthcoming Hefei and Guangzhou locations, he declined to share the price per ride but hoped it would be reasonable enough to encourage more people to try out the pilotless aerial vehicle.
    The experience should be “just like riding in a car,” added He, noting that no helmet or parachute is required. He said the initial length of rides offered by the company would vary from around three minutes to 10 minutes.
    When asked about global markets, He said overseas partners had actively reached out since news of the certification, and he expected Ehang could expand overseas in the next few years.

    Early lead

    According to technology analysts, China’s allowing commercial use of passenger AAVs signifies its innovation and leadership in transportation and mobility. 
    “This is a major development and shot across the bow from China showing technology innovation is accelerating,” said Dan Ives, global head of technology research at Wedbush Securities. 
    China has already established itself as a global leader in electric vehicles and autonomous driving. Flying taxis, meanwhile, represent “one of the next frontiers for the auto and tech industry,” said Ives, adding that China already has created a clear lead in that space. 
    Beijing first released rules for unmanned aircraft flight — vehicles without a pilot on board — in June 2023. The U.S., on the other hand, has yet to roll out comparable regulations.
    Instead, Washington’s Federal Aviation Administration last year unveiled general rules for “powered-lift” vehicles, which includes some electric vertical takeoff and landing (eVTOL) aircrafts. 
    eVTOL encompasses electric-powered aircrafts designed to carry passengers and take off and land vertically without the need for runways. However, the FAA has focused on those that are manually piloted.
    Tu Le, founder of auto industry consultancy Sino Auto Insights, told CNBC that the U.S. has been falling behind China and even the EU in eVTOLs due to this lack of favorable policies, chalking it up to overregulation, lobbying from competing industries or “just plain politics.”
    Meanwhile, China has been backing eVTOL technology as part of its “low-altitude economy,” the development of which has become a major policy goal. The term refers to economic activity taking place in airspace below 1,000 meters, well under the around 9,000 meters most commercial planes cruise around.  
    In addition to flying taxis and other eVTOLs, examples of the low-altitude economy include unmanned drones for delivery and helicopter-operated air shuttle routes.
    The term was recently included in China’s annual work report for 2025, with the government promising to promote its development. Beijing has also committed to boosting consumption in the low-altitude economy, notably in low-altitude tourism, air sports, and consumer drones, as part of a special action plan in March.
    Already, China’s low-altitude economy is one of its fastest-growing industries, with it projected to be worth 1.5 trillion yuan ($205 billion) by 2025, and almost double that by 2035, according to a report by the research group Hurun. 

    Competition ramping up 

    Sino Auto Insights’ Le also credits China’s progress in the eVTOLs sector to a high degree of domestic competition. 
    China has seen a major ramp-up of prospective players in recent years, as companies prepare for a high-tech future that was once confined to science fiction. 
    Firms investing in the space have included electric vehicle makers like GAC, Geely and Xpeng.
    Xpeng’s flying car division, Xpeng Aero HT, last week, completed a maiden flight of its “Land Carrier” product — a van paired with a 2-man quadcopter, the company told CNBC. 
    Xpeng Aero HT said it will hold a pre-sale launch event and complete the construction of its mass production factory in the second half of the year. It also aims to obtain certifications for airworthiness by the end of the year.
    Last month, XPeng Motors CEO He Xiaopeng told state media the company plans to mass-produce flying cars by 2026, as China’s low-altitude economy is boosted by supportive policy.
    However, despite China leading in eVTOL regulation, it is expected to face competition from international companies also investing in and building various types of air vehicle technologies. 
    Some of those companies include international companies like America’s Boeing, France’s Airbus, and the Brazilian firm Embraer, which have taken steps to take advantage of future flying car demand. 
    Numerous startups, including Joby Aviation, Archer, and Wisk, in the U.S. are also planning on launching various commercial air taxi services over the next few years. 
    According to Wedbush’s Ives, the global electric vertical takeoff and landing (eVTOL) aircraft business could grow into a $30 billion market opportunity over the next decade. More

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    China’s response to new U.S. tariffs will likely focus more on stimulus, building trade ties

    China’s reaction to new U.S. tariffs will likely focus on domestic stimulus and strengthening ties with trading partners, according to analysts based in Greater China.
    “I think the focus of China’s response in the near term won’t be retaliatory tariffs or such measures,” said Bruce Pang, adjunct associate professor at CUHK Business School.
    At the Chinese export hub of Yiwu on Thursday, businesses seemed nonchalant about the impact of the new U.S. tariffs, due to a perception their overseas competitors wouldn’t gain an advantage, said Cameron Johnson, Shanghai-based senior partner at consulting firm Tidalwave Solutions.

    Chinese national flags flutter on boats near shipping containers at the Yangshan Port outside Shanghai, China, February 7, 2025. 
    Go Nakamura | Reuters

    BEIJING — China’s reaction to new U.S. tariffs will likely focus on domestic stimulus and strengthening ties with trading partners, according to analysts based in Greater China.
    Hours after U.S. President Donald Trump announced additional 34% tariffs on China, the Chinese Ministry of Commerce called on the U.S. to cancel the tariffs, and vowed unspecified countermeasures. The sweeping U.S. policy also slapped new duties on the European Union and major Asian countries.

    Chinese exports to the U.S. this year had already been hit by 20% in additional tariffs, raising the total rate on shipments from China to 54%, among the highest levied by the Trump administration. The effective rate for individual product lines can vary.
    But, as has been the case, the closing line of the Chinese statement was a call to negotiate.
    “I think the focus of China’s response in the near term won’t be retaliatory tariffs or such measures,” said Bruce Pang, adjunct associate professor at CUHK Business School. That’s according to a CNBC translation of the Chinese-language statement.
    Instead, Pang expects China to focus on improving its own economy by diversifying export destinations and products, as well as doubling down on its priority of boosting domestic consumption.

    China, the world’s second-largest economy, has since September stepped up stimulus efforts by expanding the fiscal deficit, increasing a consumption trade-in subsidy program and calling for a halt in the real estate slump. Notably, Chinese President Xi Jinping held a rare meeting with tech entrepreneurs including Alibaba founder Jack Ma in February, in a show of support for the private sector.

    The policy reversal — from regulatory tightening in recent years — reflects how Beijing has been “anticipating the coming slowdown or even crash in exports,” Macquarie’s Chief China Economist Larry Hu said in a report, ahead of Trump’s latest tariff announcement. He pointed out that the pandemic-induced export boom of 2021 enabled Beijing to “launch a massive regulatory campaign.”
    “My view stays the same,” Hu said in an email Thursday. “Beijing will use domestic stimulus to offset the impact of tariffs, so that they could still achieve the growth target of ‘around 5%.'”
    Instead of retaliatory tariffs, Hu also expects Beijing will focus on still using blacklists, export controls on critical minerals and probes into foreign companies in China. Hu also anticipates China will keep the yuan strong against the U.S. dollar and resist calls from retailers to cut prices — as a way to push inflationary pressure onto the U.S.
    China’s top leaders in early March announced they would pursue a target of around 5% growth in gross domestic product this year, a task they emphasized would require “very arduous work” to achieve. The finance ministry also hinted it could increase fiscal support if needed.
    About 20% of China’s economy relies on exports, according to Goldman Sachs. They previously estimated that new U.S. tariffs of around 60% on China would lower real GDP by around 2 percentage points. The firm still maintains a full-year forecast of 4.5% GDP growth.

    Changing global trade

    What’s different from the impact of tariffs under Trump’s first term is that China is not the only target, but one of a swath of countries facing hefty levies on their exports to the U.S. Some of these countries, such as Vietnam and Thailand, had served as alternate routes for Chinese goods to reach the U.S.
    At the Chinese export hub of Yiwu on Thursday, businesses seemed nonchalant about the impact of the new U.S. tariffs, due to a perception their overseas competitors wouldn’t gain an advantage, said Cameron Johnson, a Shanghai-based senior partner at consulting firm Tidalwave Solutions.
    He pointed out that previously, the U.S. had focused its trade measures on forcing companies to remove China from their supply chains and go to other countries. But Chinese manufacturers had expanded overseas alongside that diversification, he said.
    “The reality is this [new U.S. tariff policy] essentially gives most of Asia and Africa to China, and the U.S. is not prepared,” Johnson said. He expects China won’t make things unnecessarily difficult for U.S. businesses operating in the country and instead will try harder to build other trade relationships.
    Since Trump’s first four-year term ended in early 2021, China has increased its trade with Southeast Asia so much that the region is now Beijing’s largest trading partner, followed by the European Union and then the U.S.
    The 10 member states of the Association of Southeast Asian Nations (ASEAN) joined China, Japan, South Korea, Australia and New Zealand in forming the world’s largest free trade bloc — the Regional Comprehensive Economic Partnership (RCEP) — which came into being in early 2022. The U.S. and India are not members of the RCEP.
    “RCEP member countries will naturally deepen trade ties with one another,” Yue Su, principal economist, China, at the Economist Intelligence Unit, said in a note Thursday.
    “This is also partly because China’s economy is likely to remain the most — or at least among the most—stable in relative terms, given the government’s strong commitment to its growth targets and its readiness to deploy fiscal policy measures when needed,” she said.

    Uncertainties remain

    The extent to which all countries will be slapped with tariffs this week remains uncertain as Trump is widely expected to use the duties as a negotiating tactic, especially with China.
    He said last week the U.S. could lower its tariffs on China to help close a deal for Beijing-based ByteDance to sell TikTok’s U.S. operations.
    But the level of new tariffs on China was worse than many investors expected.
    “Unlike some of the optimistic market forecasts, we do not expect a US-China bilateral grand bargain,” Ting Lu, chief China economist at Nomura, said in a note Thursday.
    “We expect tensions between these two mega economies to worsen significantly,” he said, “especially as China has been making large strides in high-tech sectors, including AI and robotics.” More

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    Shoppers will pay more for bananas, coffee and toilet paper because of tariffs, trade group says

    The Trump administration’s new tariffs will likely mean higher prices for household staples such as coffee, toilet paper and bananas.
    The U.S. climate limits the domestic production of some key ingredients, according to the Consumer Brands Association, an industry trade group that represents Procter & Gamble and Coca-Cola.
    Commerce Secretary Howard Lutnick brushed off the idea that countries could win exemptions for specific goods on CNBC’s “Squawk Box.”

    A customer shops for produce at an H-E-B grocery store in Austin, Texas, on Feb. 12, 2025.
    Brandon Bell | Getty Images

    Shoppers will likely pay more for coffee, bananas, vanilla and toilet paper over the coming weeks as the Trump administration’s new tariffs go into effect.
    The U.S. plans to hike tariff rates on goods imported from more than 180 countries and territories in the hopes of bringing jobs back stateside. However, some “critical” ingredients and materials found in food, drinks and goods used daily by U.S. consumers are not available domestically, according to the Consumer Brands Association, an industry trade group that represents Coca-Cola, Procter & Gamble, Target and other consumer giants.

    “However well intended, the success of the President’s America First Trade Policy, must recognize the U.S. companies that are already doing it the right way but depend on imports for specific ingredients and inputs that cannot be sourced domestically,” Tom Madrecki, vice president of supply chain resiliency for the CBA, said in a statement. “Reciprocal tariffs that do not reflect ingredient and input availability concerns will inevitably raise costs, limit consumer access to affordable products and unintentionally harm iconic American manufacturers.”
    On CNBC’s “Squawk Box” on Thursday morning, Commerce Secretary Howard Lutnick brushed off the idea that countries could win exemptions for specific goods. But the CBA is seeking exemptions for key ingredients and materials slapped with tariffs to keep prices down for its members and their customers.
    For one, the U.S. climate limits the production of some staples of the U.S. diet, such as coffee, cocoa and tropical fruits, according to the CBA. The U.S. was the top global importer of bananas in 2023, based on Observatory of Economic Complexity data. Nearly 40% of those bananas came from Guatemala, which will face a 10% tariff on goods exported to the U.S.

    Trader Joe’s has long bragged about not raising the price of its bananas, as seen in this photo from 2014. 
    Rj Sangosti | Denver Post | Getty Images

    Spices will also become pricier for home cooks and bakers because of climate limitations, the CBA said. For example, Madagascar accounts for more than three-quarters of U.S. imports of vanilla, which is already the second-most expensive spice in the world. Exports from Madagascar will be subject to tariffs of 47%.
    Shares of spice purveyor McCormick were down less than 1% in afternoon trading on Thursday. The company plans to offset tariffs through “some very targeted price adjustments” and a broader cost-savings program, McCormick executives said in late March.

    In other cases, decadeslong shifts in the U.S. agricultural system mean domestic supply will not be able to meet demand easily.
    For example, more than 90% of oats milled for food in the U.S. come from Canada to be turned into cereal, the CBA said. But U.S. oat acreage peaked more than a century ago and has been declining in the decades since then, according to the U.S. Department of Agriculture. The domestic food system can no longer grow, store or transport U.S. oats at the scale necessary to meet demand, the CBA said.
    Shoppers will likely also find themselves paying more for inedible household staples. Toilet paper, diapers, lotions and shampoo could become more expensive as manufacturers pass on the increased costs for wood pulp, bamboo fibers, shea butter and palm oil, according to the CBA. For example, the U.S. imports most of its palm oil supply from Indonesia, which now faces a 32% duty.
    Markets plunged on Thursday in response to the tariff announcement. However, stocks in the consumer staples sector, which includes many of the CBA’s members, rose in afternoon trading as investors ditched riskier bets for the relative safety of household necessities.
    Shares of Procter & Gamble climbed more than 1%, while Coke’s stock was up 2%. General Mills’ shares ticked up 3%.

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    What America’s stockmarket plunge means

    AMERICAN STOCKS suffered along with the country’s trading partners on April 3rd, as both took a hammering from President Donald Trump. The announcement a day earlier of near-universal tariffs, and particularly steep levies against some Asian countries, shocked investors out of any complacency they may still have held regarding the new administration’s trade policies. The S&P 500 index dropped by almost 5% over the course of the day, leaving it down by more than 12% since its peak in February. Share prices of American firms reliant on imports and supply chains fell even more sharply: Best Buy, a retailer, ended the day down by 18%; Dell, a computer-maker, by 19%. More

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    Stellantis idles plants in Mexico and Canada due to tariffs

    Stellantis said it is pausing production at two assembly plants in Canada and Mexico as the company attempts to navigate President Donald Trump’s new round of 25% automotive tariffs.
    About 900 U.S.-represented employees at supporting plants will be temporarily laid off, in addition to about 4,500 hourly workers at the Canadian plant, Stellantis said.
    Ford Motor and General Motors also responded to the tariffs, but not by idling production.

    The Stellantis Windsor Assembly Plant is shown on April 1, 2025 in Windsor, Canada. 
    Bill Pugliano | Getty Images

    DETROIT — Stellantis is pausing production at two assembly plants in Canada and Mexico as the company attempts to navigate President Donald Trump’s new round of 25% automotive tariffs, the company confirmed Thursday.
    The actions are the swiftest and most drastic by an automaker regarding the new tariffs, which took effect Thursday and are imposed on all vehicles imported to the U.S., including from Canada and Mexico.

    Stellantis’ downtime starts Monday and is set for two weeks at the automaker’s Windsor Assembly Plant in Ontario, Canada, and the entire month of April at its Toluca Assembly Plant in Mexico.
    As a result of the pause in production, about 900 workers in the U.S. at supporting plants will be temporarily laid off, in addition to about 4,500 hourly workers at the Canadian plant, according to a company spokeswoman. Workers at the plant in Mexico will still report to the facility but not produce vehicles due to their contract terms, the spokeswoman said

    Read more CNBC auto news

    In an email to employees Thursday, Stellantis North American chief Antonio Filosa said the plant downtime is tied to the tariffs, as the company reviews its options.
    “We are continuing to assess the medium- and long-term effects of these tariffs on our operations, but also have decided to take some immediate actions, including temporarily pausing production at some of our Canadian and Mexican assembly plants,” Filosa said. “Those actions will impact some employees at several of our U.S. powertrain and stamping facilities that support those operations.”
    Shares of Stellantis closed Thursday at $10.21, down 9.4%. It’s the stock’s worst day since September.

    The Canadian plant produces the Chrysler Pacifica minivan and the recently released Dodge Charger Daytona EV. The Mexico plant produces the Jeep Compass SUV and Jeep Wagoneer S EV.
    Unifor National President Lana Payne, whose union represents the Canadian workers, on Thursday condemned the tariffs and voiced concerns for her members.
    “Unifor warned that U.S. tariffs would hurt auto workers almost immediately and in this case the layoffs were announced before the auto tariff even came into effect,” she said in a release. “Trump is about to learn how interconnected the North American production system is the hard way, with auto workers paying the price for that lesson.” 
    Filosa said the “current environment creates uncertainty,” but assured employees that the company, which continues to search for a new CEO, is “very engaged with all of our key stakeholders, including top government leaders, unions, suppliers and dealers in the U.S., Canada, and Mexico.”
    Halting production also will help Stellantis lower vehicle inventory levels that have built up amid lackluster sales for many of its brands.
    Stellantis’ Detroit rivals Ford Motor and General Motors also responded to the tariffs, but not by idling production.

    GM ups truck production

    GM plans to temporarily increase pickup truck production at a plant in Indiana.
    The increase in workers is in addition to those who the company was already hiring for the plant as supplemental workers to support summer breaks and time off for their regular employees, according to a person familiar with the plans.
    GM, in an emailed statement, confirmed the plans Thursday without mentioning tariffs.
    The Detroit automaker produces its crucial, highly profitable pickup trucks such as the Chevrolet Silverado and GMC Sierra at various plants in the U.S., Canada and Mexico.
    GM has not cut production at any plants as a result of the tariffs like Stellantis is doing, said the person, who was not authorized to speak to media.

    Ford employee discount

    Hours after Trump’s tariffs went into effect, Ford announced it will offer its employee discount to all customers.
    Ford said the sales program — running from April 3 through June 2 — includes “significant savings” but did not release exact details on the discounts.
    The program, which it’s calling “From America, For America,” excludes some larger vehicles like the Ford Raptor, 2025 Ford Expedition, Ford Super Duty trucks and Lincoln Navigator SUVs.
    “We understand that these are uncertain times for many Americans,” the company said in a statement. “We have the retail inventory to do this and a lot of choice for customers that need a vehicle.”
    U.S. auto sales in the first quarter came in higher than expected as consumers flocked to buy cars ahead of auto tariffs taking effect, which many expect will lead to higher vehicle prices.
    — CNBC’s Michele Luhn contributed to this article. More

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    Southwest’s bag fees and other changes could backfire, Fitch warns

    Southwest Airlines last month said it will start charging customers to check bags in May.
    Fitch warned that the policy change and other moves could weaken Southwest’s competitive position.
    The ratings agency put the carrier on “negative” outlook, saying the company could become less financially conservative.

    A Southwest Airlines jet approaches Midway Airport on Dec. 15, 2023, in Chicago. (John J. Kim/Chicago Tribune/Tribune News Service via Getty Images)
    John J. Kim | Chicago Tribune | Getty Images

    Southwest Airlines’ new policies such as charging for checked bags for the first time could backfire, Fitch Ratings said Thursday.
    Southwest is reversing its decades-old two “bags fly free” policy for checked luggage in May, though there are exceptions for travelers with a Southwest credit card, elite frequent flyer status or who buy the highest classes of tickets.

    It is also launching assigned seating and a no-frills basic economy fare and said flight credits will expire.

    Read more CNBC airline news

    Fitch issued a negative ratings outlook for the company, long known for its strong balance sheet, because “Southwest may shift to a less conservative capital allocation and financial policy, while ongoing strategic changes have the potential to impact its competitive position relative to network carriers.
    “Items aimed at improving profitability such as the introduction of bag fees and expiring flight credits risk eroding Southwest’s competitive strengths relative to peers,” Fitch said.
    Social media posts from Southwest, even if they’ve been unrelated to policy changes, have drawn angry comments about the shifts, but market share loss, if any “is uncertain,” the firm noted.
    Southwest declined to comment on Fitch’s new outlook. The airline has been under more intense pressure to improve margins since activist hedge fund Elliott Investment Management took a stake in the carrier and later won five board seats in a settlement last year.

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    Mortgage rates tumble on tariffs, but housing costs still near record high

    The average rate on the popular 30-year fixed loan plunged 12 basis points to 6.63% on Thursday.
    For the four weeks ending March 30, the typical U.S. homebuyer’s monthly payment hit a record high for the second week in a row, reaching $2,802.
    In March, there was a 10% annual jump in new listings, with active listings up roughly 28%.

    Mortgage rates fell sharply Thursday following the Trump administration’s tariff announcement.
    The average rate on the popular 30-year fixed loan plunged 12 basis points to 6.63%, according to Mortgage News Daily. That put it at the lowest level since October.

    The massive sell-off in the stock market early Thursday sent investors fleeing to the bond market. That caused bond yields to drop. Mortgage rates loosely follow the yield on the 10-year U.S. Treasury, and they had been moving in a very narrow range since late February.
    “While plenty of uncertainty remains over the finer points of Wednesday afternoon’s tariff announcement, markets have heard enough to brace for impact on global trade,” wrote Matthew Graham, chief operating officer at Mortgage News Daily.
    The drop in rates comes at a good time for the housing market, as the historically busy spring season kicks into gear. But there are several other factors working against buyers and hitting home affordability hard.
    For the four weeks ending March 30, the typical U.S. homebuyer’s monthly payment hit a record high for the second week in a row, reaching $2,802, according to Redfin, a real estate brokerage.
    “Sale prices are up 3.4% year over year, and the weekly average mortgage rate is 6.65%, near its lowest level since December but more than double pandemic-era lows,” according to the report.

    Even with a slight drop in mortgage rates Thursday, roughly 70% of households, or 94 million, cannot afford a $400,000 home; the estimated median price of a new home is around $460,000 in 2025, according to the National Association of Home Builders. This calculation was based on income thresholds and underwriting standards.
    The minimum income required to purchase a $200,000 home at the mortgage rate of 6.5% is $61,487, according to the report. In 2025, about 52.87 million households in the U.S. are estimated to have incomes no more than that threshold and, therefore, can only afford to buy homes priced up to $200,000.
    While there is a growing supply of homes coming onto the market, that supply is not at the price point where it is most in demand, meaning, it’s not on the lower end. It is also, in general, far lower than it has been historically, due to chronic underbuilding since the Great Recession.
    “Supply is picking up; a lot of people I’ve spoken to over the last year or two are calling, saying they’re ready to list their house,” said Matt Ferris, a Redfin agent in northern Virginia. “Some believe we’re at the top of the market, and they want to get top dollar for their house. Here in the D.C. area, some people are selling because they’re worried about losing their government job, or because they want to buy closer to the city due to in-office policies.”
    As for the spring season so far, March saw a 10% annual jump in new listings, with active listings up roughly 28% year over year, according to Realtor.com. But it also found homes sitting on the market longer and the share of listings with price reductions rising. Pending sales, which are signed contracts on existing homes, fell 5.2% from last March in the nation’s largest metropolitan areas. 
    Some of the steepest declines were in Jacksonville, Florida, and Miami, Florida — down 15.1% and down 13.7%, respectively — where the markets have been softening due in part to reverse pandemic migration. Virginia Beach, Virginia, saw a 14.2% decline.
    “The high cost of buying coupled with growing economic concerns suggest a sluggish response from buyers in early spring. We’re seeing a market that’s rebalancing, offering more choices for shoppers,” Danielle Hale, chief economist for Realtor.com, wrote in a release. “Recent improvements in mortgage rates bode well for the later spring and early-summer housing season, as long as economic concerns settle and don’t knock buyers off course.” More