While economists agree that Trump's tariffs will raise prices across the board, the trade war will have different impacts on local economies — all the way down to how their housing markets behave.
That's because certain areas of the US rely on industries more exposed to global trade than others. With countries around the world placing retaliatory tariffs on the US — effectively reducing foreign demand for American products — areas producing those goods suffer. States that are more trade-reliant experience larger job market fluctuations than states with more domestic industries, which impacts homebuying activity.
"When we talk about trade, most people think that it's something that happens at the national level, but in reality, it plays out very differently from state to state," Nadia Evangelou, a senior economist at the National Association of Realtors (NAR), told Business Insider. "By looking at where trade is happening and how much each state relies on it, we can better understand how sensitive certain states might be to global disruptions like tariffs."
Take Louisiana, for example, which the NAR deems to be the state with the highest trade reliance, with 26.5% of its state GDP coming from exports. Evangelou considers states with an export-to-GDP ratio above 7% as highly trade-reliant.
Energy and chemicals are Louisiana's top industries, and China, Mexico, and the Netherlands each receive over $5 billion in Louisiana products. Antagonistic trade relations with China and Mexico would presumably have a negative impact on the state's economy and job market, potentially discouraging homebuyers from moving to the state and hurting the incomes of prospective homebuyers already there.
Wondering if you live in a state highly reliant on trade? Listed below in descending order are the 10 states with the highest level of exports as a percentage of GDP.
