Recent tariff developments could significantly impact construction costs. Here’s what builders should be aware of:
Tariff Updates
- March 4: President Trump imposed:
- 25% tariffs on Canadian and Mexican imports
- An additional 10% tariff on Chinese goods
- March 6: A one-month delay was announced for Canadian and Mexican goods under the USMCA.
- If implemented, tariffs on imported construction materials could increase costs by more than $3 billion.
Impact on Construction Costs
- Softwood lumber (Canada) and gypsum (Mexico)—both essential for homebuilding—are expected to rise in price.
- Builders anticipate an added $7,500–$10,000 cost per new single-family home.
- Canadian lumber tariffs will jump from 14.5% to nearly 40% by April and could exceed 50% later this year.
U.S. Plans to Expand Domestic Production
- Two new executive orders aim to:
- Increase timber harvesting on federally owned lands.
- Examine whether timber imports pose national security risks.
- NAHB supports increasing U.S. lumber production but stresses the need to expand sawmill capacity.
NAHB’s Efforts
- Advocating for reduced tariffs to keep housing costs down.
- Engaging policymakers to improve trade agreements.
- Pushing for increased domestic production to stabilize the supply chain.
Read the full article from NAHB here: Canada, Mexico Tariffs Delayed; Higher Lumber Prices Still Likely
Credit: National Association of Home Builders (NAHB)
