Donald Trump, America’s first property-developer president, helped lift the housing market out of its recent slump. All it took was chaotic tweeting, and an unpredictable trade war that’s put investors on edge.

“Perhaps the only beneficiary of President Trump’s trade war is housing, at least for the time being,” said Mark Zandi, chief economist at Moody’s Analytics. “The war has undermined the economy and pushed down mortgage rates.”

Trump has thrown conventional housing wisdom out the door. When the economy is strong, as it is now, rates typically rise and investors leave the relative safety of Treasuries and mortgage bonds.

One of the surprises of the Trump era is that chaos has been the best medicine for housing, at least in the short run. The trade war with China has slowed global economies, and borrowing costs have plunged, even with U.S. unemployment at the lowest in 50 years.

Mortgage rates remain near historic lows. The 30-year fixed rate dropped to 3.49% last month, the lowest level in almost three years, and a full percentage point lower than a year earlier. That drop boosted sales by 117,000, about 35% more than would be expected, based on a CoreLogic Inc. analysis of data starting in 1971. Last September, after a 0.8% rise in rates, sales plunged by 173,000.

What might seem like small changes to mortgage rates are having bigger consequences than they have in the past because today’s buyers are struggling with affordability.

Mending Market

The global economic uncertainty fueled by trade disputes has helped the housing market mend. Contracts to purchase previously owned homes in September posted the largest annual increase in four years, the National Association of Realtors reported this week. And the homeownership rate in the third quarter rose for the first time this year, as renters flooded back into the purchase market.

Chinese officials are casting doubts about reaching a comprehensive long-term trade deal with the U.S. even as the two sides get close to signing a “phase one” agreement, Bloomberg reported on Thursday.

“Housing’s on a razor’s edge,” Zandi said. “If mortgage rates rise even modestly, the housing market will go from rip roaring to a deep freeze.”

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