07 Aug Tariffs Catching up to Indiana Home Builders
Tariffs Catching up to Indiana Home Builders
New construction decreased in the month of June, leading economists to believe the rise in building supply costs are to blame.
INDIANAPOLIS, Ind. – According to the most recent single-family permit numbers for June, new home construction has decreased. The United States Census Bureau has reported 1,493 single-family permits for the month of June, a 10 percent decrease from May of 2018 and an 8 percent decrease from June of 2017 when 1,663 permits were pulled.
“For months builders have feared the increase in lumber prices and rising labor costs would eventually have a negative impact on our ability to meet growing consumer demand,” said Indiana Builders Association President Pat Richard.
The federal administration has already imposed tariffs on steel and aluminum imports, and the housing industry is already reeling from sharp increases in lumber prices resulting from tariffs averaging more than 20% that were placed on Canadian softwood lumber shipments into the United States. The increase in the cost of lumber since the beginning of 2017 has been enough to drive up the price of an average new single-family home by more than $6,000 and the market value of an average new multi-family housing unit by roughly $2,400.
“The concern over material and labor costs is making it more difficult to build homes at competitive price points, particularly for newcomers entering the housing market.” said Indiana Builders Association Chief Executive Officer Rick Wajda. “We will continue to have discussions with our federal policy makers on the rising construction costs and encourage them to take action to keep housing affordable across the country.”