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Impact of Tariffs on New Home Prices

By Ryan Waldron on July, 13 2018
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Ryan Waldron
Ryan Waldron

Chief Operations Officer
Ryan has 16+ years’ experience in construction, purchasing, and operations. He was recognized as the 2016 Builder of the Year by the Temple Area Builder’s Association.

It goes without saying that new home sales prices increase when construction costs do, but what is most often overlooked is the impact this has on the value of homes in the area and increased equity potential.

In March, the chairman of the National Association of Home Builders (NAHB) Randy Noel issued a statement regarding the tariffs on steel & aluminum imports, indicating that these additional tariffs will translate into higher costs for home builders at a time when key building materials are at record highs.

 

These tariffs are in addition to the rising lumber costs which caused an increase of $9000 on average to a new single-family home since the beginning of 2017.

 

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While the new tariffs will impact everything from aluminum foil to automobiles, the combined impact of rising steel, aluminum, lumber and labor costs has led to a much greater overall impact to the price of building new homes.

In this market, price increases for new homes is inevitable - when combined with rising interest rates, there won't be a better time to make the investment in a new home.

 

The average sales price of single family homes has been on the rise since 2009 (according to this NAHB study) and with increased demand this trend is expected to continue.

Whether you are a first-time homebuyer or real estate investor, rising prices are nothing to be afraid of.

 

Purchasing a home and locking in today's price allows you to increase the equity in your home when prices do rise.

 

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Over 12 years ago, Omega made the commitment to continuous improvement and building every home following lean principles.

As a result we have reduced waste during construction, designed highly efficient floor plans, increased quality, and shortened the time it takes to build our homes - all of which help us to keep our costs low and offer affordable homes that are competitively priced.

 

Not all home builders are the same.

To get started, check out our latest guide with 3 Questions to Ask Your Homebuilder:

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