Boston has enough pent-up demand from buyers to dodge economic concerns, experts say. iStock illustration

Tariff fears might be overshadowing the start of this year’s spring homebuying season, but some of Greater Boston’s biggest brokers don’t expect outsized buyer demand to go away.

The first sign, they say: year-over-year growth in home sales over the typically quiet winter months.

According to the most recent data from The Warren Group, the publisher of Banker & Tradesman, there were 4,765 single-family home sales in the first two months of 2025, a 7 percent increase over the same period in 2024. The median single-family home sale price increased 5.5 percent on the same basis to $580,000.

“In Massachusetts, the last five months of sales have exceeded the same time period in both ʼ24 and ʼ23,” said Pauline Bennett, Northeast regional president at Coldwell Banker Realty. “Seasonality is definitely back but I really thought that seeing five straight months of more sales over ʼ24 and ʼ23 was a very good barometer for the spring marketplace.”

Early Signs Are Positive

The increase in sales illustrates that demand for homes remains high in Massachusetts despite economic jitters, brokers interviewed for this story said.

“The entry level is certainly very, very fast,” Colleen Barry, CEO for Gibson Sotheby’s International Realty. “It’s very quickly moving, typically multiple offers in those scenarios. As you move toward the higher end of the market, it slows down a little bit.”

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Massachusetts’ infamous, ongoing lack of inventory should lead to a relatively strong spring housing market regardless of this winter’s economic jitters, said Massachusetts Association of Realtors 2025 President Sarah Gustafson

“We are still anticipating – again, because of the shortage of supply – a strong housing market this season,” she said. “It seems with the [high] interest rates, there was a lot of concern about that maybe six or eight months ago. Now we’re seeing our buyers working with the rates that they have.”

Any inventory that does come on to the market will help buyers and could help prices stabilize instead of surge upwards, said Gustafson, who’s also the operating principal and broker at Keller Williams Pinnacle Central.

While the lock-in effect may still drag on current homeowners’ willingness to sell, Bennett said, first-time buyers are facing the biggest challenge heading into the spring market.

“Not as much as they were at seven, for sure, seven-and-a-quarter,” Bennett said. “There are certainly a segment of sellers that are experiencing the lock-in effect. The bigger challenge is for the first-time homebuyer, for the new home buyer, they don’t have the lock-in effect and they’re in a very competitive market.”

Uncertainty over the American economy’s direction has dominated the news in February and March. Real estate brokers are watching to see if it affects home sales in April and May. iStock illustration

Consumers Anxiety Spikes

But as March turned to April, the entire country appears consumed with economic uncertainty.

Tariffs announced in February and then delayed by President Donald Trump have been targeted at Canada, Mexico and China. And after much hype, last week he announced a “baseline” 10 percent tax on imports from every country on the globe, and said tariffs on key trading partners like the European Union and China will run much higher – 20 percent and 34 percent, respectively.

Combined with the administration’s hardline immigration policies, economists say the moves could trigger another round of painful inflation.

That message appears to be getting through to consumers.

University of Michigan researchers’ highly-regarded index of nationwide consumer sentiment dropped 27.1 percent year-over-year in March, a 10.5 percent drop over February’s reading. And the U.S. Commerce Department’s regular report of inflation-adjusted consumer spending barely budged, suggesting average Americans are husbanding their cash.

Locally, in February the Associated Industries of Massachusetts Business Confidence Index suffered its largest one-month drop since the onset of the COVID-19 pandemic. The index declined 5.2 points month-over-month to 50.4, just above what the association considers “pessimistic” territory. The index also ended the month 4.1 points lower than in February 2024.

For any buyer with the luxury to treat homebuying primarily as an investment, these economic warning signs may not be much of a deterrent.

“I think any time when we see a lot of volatility in the stock market, the real estate market becomes even more attractive,” Bennett said. “Because not only is it a great investment vehicle, it’s also dual-purpose.”

Recent stock market volatility tied to the Trump administration’s tariffs and attempts to slash federal spending might even help encourage some of these higher-end buyers, said Barry.

“If someone is doing beyond the standard 401K investment, they maybe have stockbrokers doing trades for them on the regular basis, those folks are a little bit more concerned,” she said. “Some of those folks are the ones that we’re talking about who have said, ‘Listen, I think I want to pull someone to pull some money out of the stock market. Let’s look at another place to put it.’ Real estate is a very stable investment in our marketplace.”

Uncertainty Historically Slows Buyers

But for the bulk of homebuyers, uncertainty in any aspect of life can still affect the real estate market.

“It may not be that a buyer or seller has specific language for it, but some concerns where it makes them a little more apprehensive about committing to something right now,” Barry said. “That can happen from some kind of geopolitical challenge around the world. It could happen from a pandemic. It can happen from economic instability. It can happen during election periods. That kind of uncertainty tends to make some people put their searches on hold or put their home sale on hold, but what we know about every single one of those circumstances is that it comes and goes.”

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Even if there is “positive” uncertainty, it can keep buyers on the sidelines, said Gerry Bourgeois, senior advisor to the CEO and COO at Lamacchia Realty.

“Whether it’s economic uncertainty or employment uncertainty or combination thereof, uncertainty always slow things down. People, if you think you’re going to potentially lose your job, you’re less likely to go buy a bigger house. Also the other alternative is, if you’re going to get a huge raise, you may hold off until you get the huge raise.”

Despite uncertainty brought on by tariffs or interest rates, brokers say they’re still holding out hope that there will be more inventory and an increase in seller activity to match expected buyer demand, come the spring, especially if the Federal Reserve cuts its benchmark rate at its next meeting in May.

“We’re hoping for a little more inventory than we have so far,” Barry said. “We do know that more is coming, but the question is going to be how much of it, and do those interest rates budge?”