In March, predictions were bleak regarding how the Trump Administration’s new tariffs would affect the industries across the nation, particularly the construction industry. Now that we are a few months into the new tariffs, we can take stock of just how these tariffs are affecting industries thus far.

Tariff on Canadian softwood lumber 

Added in 2017, the 20 percent tariff on Canadian softwood lumber has resulted in higher costs for homes. For a single-family home, the tariff caused an increase of $9,000 to the overall cost. Moreover, the cost of a multifamily unit has gone up by $3,000. Overall, these tariffs are affecting home prices and making it even less affordable for Americans.

Tariff on steel and aluminum

The 25 percent tariff on the steel and 10 percent on aluminum by foreign suppliers is also contributing to the rising costs of homes. Rebar is used with concrete to make concrete flooring and foundations. It is used to build parking garages, any building over five floors, condos, and apartments. According to Jack Kern, director of research at Yardi Matrix, there are other materials that builders can use to substitute for steel. However, these materials are typically more expensive.

Beyond the consumer

Although these new tariffs are making homes more expensive, pricing out even more Americans, it is also affecting the companies that build these homes. According to the article “New Homes Could Get More Expensive Thanks to New Steel, Lumber Tariffs” published by, “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 the cost of lumber or steel makes it harder to price out the cost of building a home as well as determining how much buyers will have to fork over to build their new home.

Contrary to this notion, the vice president of sales and marketing, Charles Rugh, for San Antonio Steel Co. (SASCO) stated that these tariffs make things more predictable. According to the article “Lumber and Steel Tariffs Take a Toll on Construction Projects,” Rugh said, “now that the tariff is in place, and everyone knows the conditions, there has been more stability in pricing. That makes it easier for everyone to run their business.”

Others have voiced their support of these new tariffs, including JSW Steel, an Indian steel pipe and plate manufacturer who has a factory in Baytown, Texas. They said that the new tariffs would “enable the company to create thousands of new jobs and be more competitive globally.”  Moreover, the company stated that its “American division would invest 1$ billion into its facilities in Baytown and in Ohio.”

However, the Texas Alliance of Energy Producers (TAEP), wrote a letter in May to the Commerce Department to share its opposition to the new steel tariffs. Steel is a major component of oil and gas production in Texas. As a result, it was critical of the tariffs and voiced its concerns.

It is clear that many are divided over whether or not these new tariffs are a good idea. The short-term results thus far have shown an increase in the cost of homes for Americans, as well as making it more difficult for the construction industry to acquire the necessary materials to build projects. For now, this issue will have to be watched closely to develop a clearer view of the positive and negative effects of these tariffs.