Local Realtors and home developers watch for Trump’s next moves for tariffs

COLUMBIA Mo, (KMIZ)

Building supplies are on the long list of products affected by President Donald Trump's recent tariffs and as Trump extends tariffs on cars, local developers and Realtors are hoping for more exceptions to be made.

Since Tuesday, 25% tariffs have been imposed on products from Mexico and Canada with an additional 10% tariff on Chinese products.

According to the National Association of Home Builders, in 2023, around 70% of $8.5 billion worth of sawmill and wood imports were imported from Canada.

Of around $456 million in lime and gypsum products, 71% were from Mexico.

The NAHB expects the new tariffs to raise the cost of imported construction materials by $3 to $4 billion.

"People have been saying maybe there'll be short-term tariffs where they're only temporary for a couple of months, maybe a long-term implementation of tariffs, whether it's short term or long term, is going to affect our industry," director of sales for Hemme Construction Orie Hemme said.

Currently for co-owner of C & C Construction Rhonda Carlson, the tariffs haven't been a major concern as lumber prices tend to fluctuate frequently due to natural disasters like hurricanes or forest fires.

"It is a concern, but because there are other things always going on, because it is a commodity that changes on a daily basis, you watch what happens," Carlson said. "If you're in this business for any length of time, it's something that you're concerned about, you watch that just like fuel prices."

With supply costs expected to rise, new homes are expected to be more costly and build times may increase.

Central Habitat for Humanity's Director of Community Outreach Ashley Switzer is also expecting to be affected.

"When we're talking about housing and affordability and the prices on our building materials since COVID have gone up significantly, we're looking at a pretty big spike in building materials and lots of other things," Switzer said.

A major concern for Switzer has been how the tariffs may impact organizations' donors as the higher costs may have Habitat for Humanity leaning on them and other sources of funding for support.

"We are now going to be leaning more heavily on our donors and on our ReStore supply and things like that to offset some of these national grants that might not come down like they used to or the rising cost of building materials," Switzer said. "The actual tariffs will make the cost of building skyrocket, but it also puts enough fear into the economy that individuals and businesses are less likely to donate funds and materials."

Switzer adds that she hopes for Habitat for Humanity to continue building homes at their current rate, however, mortgage costs may change.

"During COVID, Habitat started looking at our mortgages, we went from a 20 year mortgage to a 30 year mortgage so that our families' monthly payments are still affordable," Switzler said. "We're looking at what affordability looks like over the next couple of years if building costs continue to rise."

On top of higher costs for new houses Columbia and Boone County's current market is also seeing a decrease in the sale of used homes. Following low costs during COVID-19, low interest rates are pushing homeowners away from selling and instead renovating.

"Inventory for existing homes is really tight also and people who are living in existing homes, most of them have very low interest rates because they refinanced during COVID," Chief Executive Director of Columbia Board of Realtors Brian Toohey said. "Existing homes making up the difference in the cost of new construction houses probably really isn't a reasonable solution."

Renovation costs are expected to go up with tariffs, however, contractors are not expecting the renovation trend to die down.

Compared to the rest of the country, Mid-Missouri is expected to tank the extra costs.

According to the Columbia Board of Realtors, the median cost of single-family homes in Boone County was around $317,000 while the average price was around $354,000 in January. Both numbers were down by 5% and 3% respectively compared to January 2024. Homes sold have also seen a 9% increase.

The average median sale price for a single-family home in Boone County and Columbia was around $90,000 less than the U.S. median.

According to the U.S. Census, Boone County has been seeing consistent growth, increasing by around 20,000 people from 2010 to 2020 and around 6,000 from 2020 to 2023.

"Our housing market is still recovering from the COVID market, but it's still very stable because we don't have enough housing inventory to meet the needs of everyone looking for housing," Toohey said. "I think you'll still continue to see additional home construction."

Hemme adds that historically, Columbia saw better numbers than other states during the recession and expects similar results.

"We're going to see price increases if we have tough times nationally," Hemme said. "I think Columbia will probably be better than the national average, but, you know, it will still hurt."