On and off again tariffs have resulted in heightened economic uncertainty, particularly for those industries that rely on cross-border supply chains, including home building. Construction materials such as lumber, steel, and aluminum could see disrupted supply chains and/or an increase in costs since they are difficult to source in the quantities needed domestically.
This article will provide an overview of what tariffs are, why they are implemented, how their implementation has impacted the housing industry in the past, and how we expect the new tariffs to impact us today.
First, the basics: what is a tariff?
Tariffs are essentially a tax on imported goods that raises the cost of bringing foreign materials into the country. The increase in cost must then be absorbed somewhere along the supply chain. Options include:
- The foreign supplier may lower prices to remain competitive.
- The importer may absorb some of the cost.
- The consumer (in this case either the builder or buyer) may end up paying the difference.
The full article is available to clients of Zonda’s National Outlook report. You can learn more and subscribe here: https://zondahome.com/products/data-intelligence/national-outlook/
