How Tariffs are Adding Fuel to the U.S. Housing Crisis
With all the talk around inflation, tariffs, and the housing crisis, there’s one overlooked fact: U.S. home construction is heavily reliant on imports. Up to 50% of the materials and equipment in a typical American home come from overseas, making tariffs a major factor in construction costs.
Higher Tariffs, Higher Home Prices
A 2017 report by the National Association of Homebuilders (NAHB) examined a 25% tariff on imports from China and found it could drive up construction costs by $2.5 billion. This impact is evident: between 2017 and 2024, the median price of a new American home shot up 33%, according to the St. Louis Fed. Rising tariffs don’t just affect builders—they directly increase costs for homeowners.
What’s Driving Costs?
Key materials for U.S. homebuilding often come from abroad:
- Steel – 50-60% imported, mainly from China and Canada.
- Ceramic Tiles and Flooring – 60-70% from Italy, Spain, and China.
- Plumbing Fixtures – 50-70% from China and Mexico.
- Glass Products – 30-40% from Europe and China.
- Tools – 50-80% from China, Taiwan, and Mexico.
The U.S. has traditionally benefited from trade, yet increased tariffs threaten to stifle this advantage. Trade restrictions may serve some political aims, but the cost is passed on to consumers, who face rising prices—particularly for essential goods like housing.
The Bottom Line
The benefits of trade extend far beyond the political sphere. For the average American household, open trade contributes over $10,000 annually in equivalent income. By raising trade barriers, we risk making life less affordable, especially for those seeking homes in an already tough market.