If you’re planning to build a home, remodel, or add an ADU, you’ve probably noticed rising construction costs. A big reason for this is the new tariffs on imported wood, particularly softwood lumber from Canada. These tariffs are directly impacting homeowners by increasing the cost of materials, which in turn drives up project prices.
Here’s what you need to know about these tariffs, how they affect your construction project, and what you can do to navigate these changes.
Why Are Tariffs Raising Construction Costs?
By Friday, Trump threatens to impose a 25% tariff on imports from Canada, including essential building materials like softwood lumber and gypsum. Since Canada supplies about 70% of the lumber used in U.S. home construction, these tariffs significantly impact material costs.
Before this, Canadian lumber already had a 14.5% tariff. Now, with the additional tariffs, the total tax on imported lumber is nearly 40%. This means that wood products like framing lumber, plywood, and cabinetry are becoming much more expensive.
According to the National Association of Home Builders (NAHB), these tariffs could increase the cost of imported construction materials by more than $3 billion across the industry. That cost inevitably trickles down to homeowners like you.
How Will This Impact Your Home Build or Renovation?
If you’re a homeowner looking to build or renovate, here’s how these tariffs might affect your project:
Higher Material Costs: Lumber is one of the most significant expenses in construction. The new tariffs are expected to add $7,500 to $10,000 to the cost of building an average home. ADUs and home additions will also see price increases.
Longer Project Timelines: Some contractors are sourcing alternative materials or delaying purchases, which can extend construction timelines. If you’re planning a project, expect potential delays.
Higher Overall Home Prices: Rising construction costs don’t just affect new builds. They also increase the cost of renovations, ADUs, and even home repairs. This could affect your home’s resale value or your ability to afford planned upgrades.
Budget Adjustments: If you’ve received a project estimate, be aware that pricing may change if material costs continue to rise. Some contractors now include clauses in contracts that allow for adjustments if material prices spike unexpectedly.
What Can Homeowners Do?
Despite these challenges, there are ways to keep your project on track and manage costs effectively:
✔ Plan Ahead – If you’re considering a home build, addition, or remodel, start planning early. Material costs can fluctuate, so getting ahead of price increases can help you budget effectively.
✔ Explore Alternative Materials – Some contractors are shifting to materials like engineered wood, composite products, or steel framing, which may be less affected by tariffs. Ask your contractor about cost-effective alternatives.
✔ Order Materials Early – If you’re working with a contractor, discuss pre-purchasing materials to lock in prices before further increases. This can help prevent last-minute cost hikes.
✔ Be Flexible with Design Choices – Wood products used for flooring, cabinetry, and trim may be more expensive. Consider alternative finishes or styles that can help balance costs while maintaining your vision.
✔ Work with a Knowledgeable Contractor – A good contractor will help you navigate these challenges by sourcing the best materials, finding cost-effective solutions, and keeping you informed about industry changes.
Final Thoughts
As a homeowner, it’s frustrating to see construction costs rise due to government tariffs that are out of your control. However, understanding the factors behind these price increases can help you make informed decisions.
By planning ahead, considering material alternatives, and working with a contractor who understands these challenges, you can still bring your vision to life without breaking the bank.
If you’re thinking about building, remodeling, or adding an ADU, let’s discuss how to navigate these price changes and find solutions that work for your budget. Contact us today to start planning your project.
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