25 May The High Cost Of Success
Tariffs on lumber, steel and aluminum have increased costs for single-family homes and larger projects
By Ben Russell
Published at 6:17 AM CDT on May 16, 2018 | Updated at 6:46 AM CDT on May 16, 2018
Tariffs, Worker Shortage Raising Construction Co
The cost to build a new home in North Texas continues to rise for a multitude of reasons: chief among them are a tariff on imported Canadian lumber and an ongoing construction worker shortage in the region.
The National Association of Homebuilders estimates that the 20 percent tariff on Canadian lumber, which was instituted late last year, has added approximately $6,000 to the cost of the average home being built today.
In Fairview, Collin County, Tim Jackson, of Tim Jackson Custom Homes, noted that the tariff may be 20 percent but the price on lumber for his projects has actually risen between 45 to 50 percent in recent months.
“The people that are really impacted are the first time homebuyers,” Jackson said. “The entry level has been impacted the most.”
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As for the worker shortage, it has only grown in the region amid the ongoing construction boom – developers started work on more than 15,000 new homes in Texas during the month of March alone.
The Dallas Builders Association estimates that tens of thousands of construction workers are needed to meet the demand locally.
In January, the belief was that 20,000 new workers were necessary. But by this spring, a new survey conducted by Meyers Research for the Dallas Builders Association indicated that the construction labor shortage in North Texas would reach 37,819 jobs in 2018
“The labor shortage is adding about two months and about $5,000 to the cost of every single job that gets done,” Phil Crone, Executive Officer of the Dallas Builders Association, told NBC DFW in March.
Tariffs put in place in March on imported steel and aluminum – 25 percent for steel and 10 percent for aluminum – have had less of an impact on the single-family home construction market than they have on the cost to build a multi-unit housing facility, like an apartment complex.
According to the National Apartment Association, the tariffs are expected to add $250,000 to $450,000 to future projects.