DuPage contractors brace for uncertainty as tariffs may drastically affect cost of materials

As the spring remodeling and new construction season approaches, local home construction businesses are bracing for a fair bit of uncertainty as proposed tariffs on a wide range of building materials are leaving many unknowns.

Recently, President Trump announced reciprocal tariffs on all imports including home building materials such as softwood lumber, gypsum, steel and aluminum with an expected effective date of March 12.

Some local contractors have taken a wait-and-see attitude noting that the proposed tariffs are part of a larger negotiating tactic and may actually never come to fruition.

They speculate if the tariffs do become a reality, they only comprise one element of an already challenging housing market that includes excessive local property taxes, bureaucratic red tape and high interest rates.

Others are adapting their business models to offset or lessen the impact of predicted higher costs in housing supplies and general business equipment for themselves and their clients.

Kevin Greaney with Downers Grove-based Platinum Builders said his company has relayed to its customers who are on the fence about going ahead with a potential remodeling project such as a new kitchen or basement, “in my opinion, things are just going to get more expensive.”

“We are definitely hearing more grumblings and not only in the building industry,” Greaney said.

His nearly 20-year-old company, which constructs new houses as well as completes home renovations, is also considering buying building supplies for future needs.

In addition, he is contemplating an earlier than planned purchase of a company vehicle in order to avoid higher prices in the future.

Like most industries, the building industry experienced inflationary price increases during COVID, especially in terms of lumber costs. Greaney remembers having clients hold off on projects anticipating prices to go down—something that never occurred.

Today, a “fair amount” of Platinum Builder’s lumber and hardwood products are sourced from Canada, and much is unknown about the cost of these products in the near and distant future.

In 2023, according to the National Association of Home Builders [NAHB] $184 billion worth of goods were used in the construction of both new multifamily and single-family housing.

The organization estimates that new tariffs on supplies from China, Canada and Mexico are projected to raise the cost of imported construction materials by $3 billion to $4 billion.

As a result, NAHB has sought a tariff exemption for building materials citing the current housing shortage and housing affordability crisis.

Kyle Donoghue, president and owner of DuPage Construction of Downers Grove, an exterior home renovator, said, its manufacturers have already sent information warning of “drastic price increases” and encouraged local companies to only provide quotes that are good for five days, over the typical 90-to-120-day quotes for work.

“It is up in the air,” Donoghue said. “It is all speculative.”

“However, if prices go up on goods, our suppliers are not going to take that hit. They are going to increase the price for us,” said Donoghue said, addinf that local businesses would have no choice but to pass the increased cost onto homeowners.

Many roofing shingles are made from crude oil, he said, which is a “high energy source” that primarily comes from Canada.

In addition, many of the parts Donoghue uses in his business come from Mexico.

Donoghue added that during COVID there was much “uncertainty” in the world. However, this is “uncertainty among business.”