CHICAGO – Tariff policies may be set at the national level, but that doesn’t mean they’ll have a one-size-fits all impact across the country. Some states have built their economies around global exports (goods such as cars and electronics that they produce and sell internationally) while others have built their economies more around imports (products coming into the country, such as car parts and machinery). Real estate professionals with a clear picture can better prepare for the impact of the administration’s new tariff policies.
“Understanding which states are most reliant on trade can help explain everything from warehouse demand and factory job growth to how sensitive an area might be to supply disruptions or price changes,” Nadia Evangelou, a senior economist and director of real estate research for the National Association of Realtors®, writes on the association’s Economists’ Outlook blog.
Exports vs. imports: State-by-state analysis
Evangelou finds that Louisiana leads the nation in exports as a percentage of gross domestic product. About 27% of the state’s GDP comes from exports, much of it from the energy and chemical industries. Texas follows at 17%, with exports mostly of oil, gas, chemicals and tech products.
On the other hand, Evangelou’s research finds Kentucky leads the other states in imports, equal to about 32% of its GDP. (Note: Imports don’t technically count as part of GDP.) Michigan and Indiana follow, at 35% and 20%, respectively. “Imports are essential to these areas for car production and industrial output,” she says.
Some states rely heavily on both imports and exports. As a percentage of GDP, Kentucky is No. 1 in imports and No. 3 in exports. “With robust manufacturing logistics, the state has become a key player in facilitating the movement of goods across borders,” Evangelou writes. Texas comes in No. 2 for exports and No. 9 for imports, due to its oil, technology and strategic position along the U.S.-Mexico border, Evangelou says.
“As a result, these states are more likely to experience the ripple effects of global supply chain shifts, both positive and negative,” Evangelou notes. “A surge in global demand supports their growth, while disruptions, such as factory shutdowns overseas or sudden tariffs, can present challenges.”
See how your state will fare using NAR’s searchable chart.
The potential housing fallout
The new-home market has expressed concerns over how tariff policies could impact the new-home sector. Builders, for example, estimate that the average new home could increase $9,200 in cost due to recent tariff actions, according to the March 2025 National Association of Home Builders/Wells Fargo Housing Market Index. Builders say tariffs on lumber, steel, aluminum, copper, home appliances, gypsum (used to make drywall) and more could put upward price pressure on their costs, which could ultimately be passed down to home buyers. NAHB estimates that, as of 2024, about 7% of all goods used in new residential construction are imported from a foreign nation.
Trade policy could also impact the labor market, with more trade-dependent states like Texas and Michigan possible seeing greater fluctuations in their job markets, Evangelou notes. Trade policies’ trickle-down effect on labor could impact the housing market.
“People and income ultimately drive housing markets,” Evangelou writes. “The states that led in home price growth were often those with rapid job growth in tech and services, high levels of domestic migration and limited housing supply or zoning constraints.” States with a smaller level of exports, she adds, appear to be “less vulnerable to global supply chain disruptions and often attract knowledge economy jobs or retirees, boosting housing demand in urban and suburban areas.” Bottomline, she notes: “The housing market thrives where people want to live and work—not merely where goods are produced or shipped.”
Read Evangelou’s analysis at NAR’s Economists’ Outlook blog.
© 2024 National Association of Realtors® (NAR)
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