The National Association of Home Builders is urging President Trump to exempt building materials from the proposed tariffs on Canada and Mexico because of their harmful effect on housing affordability.
Tariffs on lumber and other building materials will increase the cost of construction and discourage new development, and consumers end up paying for the tariffs in the form of higher home prices, NAHB warns.
In a letter to the president, NAHB noted that on his first day in office Trump issued an executive order that seeks to increase housing supply and affordability.
“Bringing down the cost of housing will require a coordinated effort to remove obstacles to construction, be they regulatory, labor or supply-chain related,” NAHB’s letter says. “NAHB stands ready to work with you to accomplish these goals. However, we have serious concerns that proposed 25 percent tariffs on Canada and Mexico will have the opposite effect, by slowing down the domestic residential construction industry.”
“On President Trump’s first day in office, he issued an executive order directing departments and agencies to deliver emergency price relief by pursuing actions to lower the cost of housing and increase housing supply,” says Carl Harris, chairman of NAHB, in a statement. “This move to raise tariffs by 25 percent on Canadian and Mexican goods will have the opposite effect. More than 70 percent of the imports of two essential materials that home builders rely on—softwood lumber and gypsum (used for drywall)—come from Canada and Mexico, respectively.
“Tariffs on lumber and other building materials increase the cost of construction and discourage new development, and consumers end up paying for the tariffs in the form of higher home prices,” Harris says. “NAHB urges the administration to reconsider this action on tariffs and we will continue to work with policymakers to eliminate barriers that make housing more costly and prevent builders from boosting housing production.”
UPDATE:
On Monday, President Trump announced a 30-day delay of the proposed tariffs on products from Canada and Mexico.
“We commend President Trump for reaching an agreement with Canada and Mexico to delay the proposed tariffs, avoiding additional strain on a housing market already facing affordability challenges,” Harris says in a separate statement. “Stability and certainty are essential for American businesses, consumers, and the strength of our economy. We urge all parties to remain committed to productive dialogue to prevent new tariffs on construction materials critical to housing our nation.”
Photo: René DeAnda
