U.S. Homebuilders Feel Tariffs Pain as Costs Keep Rising
Construction workers in LA County, California, U.S. May 7, 2025. Photo: Xinhua
May 15, 2025 Hour: 10:08 am
Surge in tariffs is driving up the cost of building a new home in the U.S by nearly US$11,000, according to NAHB data.
Just over a month after the U.S. administration imposed sweeping tariffs on its trading partners, David Truong, manager of the DuiDui Construction in Los Angeles, is already grappling with rising costs.
RELATED:
US and China Suspend Reciprocal Tariffs for 90 Days: A Step Toward Global Economic Cooperation
“The price of almost all building materials has continued to climb in recent months. Building new homes is getting more expensive by the day,” he said.
Truong offered a firsthand look at a construction site in Temple City, Los Angeles County, where the impacts of the tariffs are evident. A faucet, for example, once cost around US$160, but now retails for at least US$200. A steel-framed window, previously priced just over US$300, now sells for over US$370.
Lighting costs have seen some of the sharpest increases. “An LED recessed light, which used to sell for 12 to 15 dollars, now costs around 30 dollars,” he said. “This house needs more than 20 of them, so we’re looking at an extra 300 to 400 dollars just for lighting.”
According to April’s data from the National Association of Home Builders (NAHB), a recent surge in tariffs is driving up the cost of building a new home in the U.S. by nearly US$11,000. “Tariff-induced disruptions are making it harder for builders to price homes accurately and make crucial business decisions,” Robert Dietz, NAHB chief economist, said.
Construction input prices have now risen at a 9.7 percent annualized rate through the first quarter of 2025. “While contractors remain busy for the time being … this pace of input price escalation, coupled with rising uncertainty, will cause projects to be delayed and canceled if it persists for any meaningful length of time,” said Anirban Basu, chief economist of the Associated Builders and Contractors.
Rising costs have squeezed profit margins of Truong’s company, forcing him to raise his quotes. In Temple City, his company’s price of new home construction has risen from US$220 to US$250 per square foot. In more complex locations in some other cities, the cost can soar as high as US$280 per square foot.
Truong’s company is not alone in feeling the strain. Many contractors are facing similar challenges, with soaring costs for materials like wires, PVC pipes and cabinets. As a result, many are finding themselves with little choice but to renegotiate contracts with clients to share the financial burden.
The rising costs are not the only concern for Truong and other builders. The greatest worry, he said, is the potential for material shortages. “What we fear most is that some materials may soon be unavailable, no matter how much we’re willing to pay.”
teleSUR/ JF
Source: Xinhua
