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New Homes Could Get More Expensive Thanks to New Steel, Lumber...

And after devastating hurricanes in Houston and Florida and deadly wildfires in California, there is a big need for that lumber. "Tariffs could measurably raise the cost of building materials and hinder home construction of affordable homes," Lawrence Yun, chief economist of the National Association of Realtors®, said in a statement. Steel is used in the concrete flooring and foundations of most single-family homes. It's also used in elevator shafts, parking garages, and many stairwells. But those newer materials are typically more expensive, says Jack Kern, director of research at Yardi Matrix, a commercial real estate data and research firm based in Santa Barbara, CA. There are also fewer construction crews trained in how to properly use those materials, Kern says. “Anything that’s built that uses steel as a component is going to have a price increase," he says. "Given that home builders are already grappling with 20% tariffs on Canadian softwood lumber and that the price of lumber and other key building materials are near record highs, this announcement by the president could not have come at a worse time," Randy Noel, chairman of the National Association of Home Builders, said in a statement. Several modular home builders have complained to the Modular Building Institute, a trade group, about their costs going up as a result of the tariffs as well. Not knowing how much steel and lumber will cost makes it difficult for builders to price homes, or for buyers to know just how much they'll be shelling out on their new abodes.