Trump tariffs on lumber and appliances set stage for higher costs on new homes and remodeling projects

Trump administration's tariffs on imported goods from Canada, Mexico and China — some already in place, others set to take effect in a few weeks — are already driving up the cost of building materials used in new residential construction and home remodeling projects.
The tariffs are projected to raise the costs that go into building a single-family home in the US by USD 7,500 to USD 10,000, according to the National Association of Home Builders. Such costs are typically passed along to the homebuyer in the form of higher prices, which could hurt demand at a time when the US housing market remains in a slump and many builders are having to offer buyers costly incentives to drum up sales.
We Buy Houses in San Francisco, which purchases foreclosed homes and then typically renovates and sells them, is increasing prices on its refurbished properties between 7 per cent and 12 per cent. That's even after saving USD 52,000 in costs by stockpiling 62 per cent more Canadian lumber than usual.
«The uncertainty of how long these tariffs will continue has been the most challenging aspect of our planning,» said CEO Mamta Saini.

Bad timing for builders

The timing of the tariffs couldn't be worse for homebuilders and the home remodeling industry, as this is typically the busiest time of year for home sales. The prospect of a trade war has roiled the stock market and stoked worries about the economy, which could lead many would-be homebuyers to remain on the sidelines.

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«Rising costs due to tariffs on imports will leave builders with few options,» said Danielle Hale, chief economist at Realtor.com. «They can choose to pass higher costs along to consumers, which will mean higher home prices, or try to use less of these