Home builders could see prices rise as a result of President Donald Trump’s tariffs going into effect on Tuesday. Following a 30-day pause in February, President Trump has implemented 25% tariffs on imported goods from Canada and Mexico. However, many home builders are concerned that these tariffs could drive up material prices since Canada and Mexico supply most of the lumber and drywall used in U.S. construction, according to real estate marketing platform Realtor.com. Though the immediate impact will be on new construction, the broader housing market could eventually feel the effects as well. At the same time, Trump recently signed executive orders to expand logging in national forests in a move the administration believes will reduce reliance on foreign lumber.
Environmental groups condemned the move, but the Trump administration says that expanded domestic logging will help bring down building costs and reduce U.S. dependency on Canadian lumber.
As well, a senior White House official tells Realtor.com that the tariffs on Canada, Mexico, and China are a national security measure narrowly targeted at halting the international drug trade and illegal immigration, and are not intended as a long-term economic policy.
The official suggested that the tariffs on Canada and Mexico might not last long enough to significantly impact the supply chain for housing, which has timelines that can stretch over multiple months. Read more
