According to the trade group, tariffs add up to $10,000 to the cost of an average new home

According to the National Association of Home Builders, President Donald Trump’s tariffs could increase the cost of materials on an average new home up to $10,000.

The trade group said it received anecdotal reports from members that Trump’s taxation plan would increase material prices from $7,500 to $10,000 for the average new single-family home. The association plans for a formal investigation in the future, but the figures offer an early glimpse into what businesses and consumers can expect if Trump’s controversial taxes on Canadian and Mexican imports go as planned.

“For years, NAHB has led the fight against tariffs due to the harmful effects on housing affordability,” the association wrote in a blog post published last week. “In effect, tariffs act as taxes on American builders, home buyers and consumers.”

Trump delayed 25% tariffs last week due to Canada and Mexico imports a month after it was implemented a few days ago. This was a spectacular turnaround amidst the turmoil in financial markets. His additional hike to taxation in China raised the country’s commodity duties to 20%, but moved forward.

The NAHB said that while the coniferous wood is primarily sourced from Canada, the drywall component gypsum comes primarily from Mexico. Other materials such as steel and aluminum are imported from China to the US, in addition to finished appliances, the group said.

According to the NAHB, the implementation of the 25% tariffs Trump previously laid out in Canada and Mexico will increase the total cost of imported construction materials by over $3 billion.

Home builders had to respond to analysts and investors wondering what these taxes mean for bottom line profits. SPDR S&P HomeBuilders ETF (XHB) Uncertainty rattles investors, causing them to fall more than 22% from the highs seen in late November.

for Dr. HoughtonIt is estimated that about 20% of the wood comes from Canada. The Texas-based company, like other companies, has in recent years started to have its supply chains coming from China from the COVID pandemic. But Jessica Hansen, head of investor relations, says it still has to contest the possibility of new taxes on components coming from Mexico.

Given the possibility of Trump’s policies changing and the lack of clarity about how many of the particular products are imported, it is difficult to gather full impact, Hansen said at the Barclays meeting last month.

“There’s really no way that ends up putting what’s costing in the end, but we’ll navigate it like we do anything,” Hansen said. “If you have an inflated cost category and you’re in an environment that compresses the total margin, renegotiate as much as you can.”

Also, builders that are not so dependent on imported products have a knock-on effect. KB Homehis chief operating officer, Robert McGibney, said earlier this year that the “majority” of the products will be the “majority” in the country. He said tariffs could raise the prices of these American-made materials as competitors increase demand by localizing supply chains.

Last week, the international focus was narrowed down to US tariff policies. Taylor Morrison Home We held our first investor day. As part of the presentation, the housing builder brought in Alliwolf, the chief economist for housing data provider Zonda, to describe the market conditions since the year defined in a year with high interest rates and little inventory.

Wolf said Zonda expects Trump’s tariffs to increase material costs for home builders between 6% and 14%. She also said that border state builders could be a hit if Trump’s promise to massive deportation reduces the workforce.

When Wolves assessed where the market was heading in 2025, she said Trump said the best. She said the positive impact on home builders due to the administration’s stance on deregulation should be weighed against concerns related to immigration and trade policy.

“The first thing we’re paying attention to is the new administration. Pro-pro-regulations are low. We’re here. We love it,” Wolf said. “I’d especially like to see them remove a lot of red tape that takes a particularly long time to build a new home.”

“That being said, looking at some of our policies, such as tariffs, immigration, interest rates, all of which have a negative impact on the disproportionate aspect of our industry.”