Following President Trump’s 2025 tariff announcements and the ensuing economic uncertainty, home construction costs increased over the last year and fewer new homes began construction. These challenges continue to grow in 2026, which will further drive up the cost to rent or buy homes and make it harder to address the nation’s housing shortage.
This Joint Economic Committee – Minority report includes findings from outreach that the Committee conducted to home builders, multifamily housing developers, and realtors, who detailed ways that tariffs and economic uncertainty are making it more difficult to build and sell homes.
In addition, key new Committee calculations in this report show that:
• Materials and other products that are used to build and furnish homes have become more expensive over the past year.
o Following Trump’s tariffs on steel and copper, the price of copper and copper products in February 2026 was 25 percent higher compared to the year before and the price of steel mill products – including steel bars, wire, pipes and plates – increased by 21 percent.
o The most popular ovens at key retailers increased in price by $70 on average, or 9 percent.
• By the end of the first year of Trump’s second term, the rate at which builders secured construction permits and started construction had sunk below late 2024 levels.
• August 2025 had the lowest issuance rate for residential permits since May 2020, one of the worst months of the pandemic-era slowdown in construction.
• As industry activity declines, there are now nearly 60,000 fewer jobs in home construction compared to December 2024.
Trump’s tariffs and economic uncertainty make it more expensive to build and furnish homes
Prices for key materials used to construct homes have increased following the President’s tariffs
Recent reports estimate that Trump’s tariffs could increase building costs by $10,900 per home initially, and by more than $17,000 per home in the coming years – which could in turn drive up rental costs and home prices. After months of these tariffs hitting the market, trends in home input prices indicate that costs for homebuilders have, as expected, increased.
As shown below, both producer and consumer prices for multiple housing inputs have increased significantly compared to a year ago, making homes more expensive to build and to furnish. Notably, inflation for key building materials, construction tools, household appliances, and furniture far outpaced overall producer and consumer inflation for the same period.
The Committee also tracked the prices of the best-selling home appliances in several categories at key U.S. retailers since June 24th of 2025, immediately after Trump expanded steel and aluminum tariffs to include the content of most major appliances. As of March 2026, the three most popular appliances in several key categories increased in price, including:
• a 9% or $70.33 average increase in the price of the most popular ovens;
• a 6% or $51.00 average increase in the price of the most popular dryers;
• and a 6% or $44.33 average increase in the price of the most washing machines.
Homebuilder confidence plummeted amid Trump’s tariffs
Amid Trump’s tariffs, homebuilder confidence fell in 2025 to some of the lowest readings seen since 2012, according to the National Association of Home Builders (NAHB)/Wells Fargo Housing Market Index (HMI). This index is based on a monthly survey of single-family homebuilders and reflects builder sentiment across three conditions: current home sales, sales expectations for the next six months, and prospective buyer demand. In 2025, homebuilder confidence also fell below the 2024 average for every full month that the President was in office, as builders faced increased uncertainty following Trump’s tariff announcements and rising costs.
New housing construction has slowed, which will exacerbate the current housing shortage and endanger construction jobs
Experts across the political spectrum have pointed to the U.S. nationwide housing shortage as a primary driver of higher prices to rent and buy homes. Tariffs are on track to exacerbate this crisis. As prices and economic uncertainty have risen for housing inputs and homebuilder confidence has fallen, builders have secured fewer permits for housing construction and broken ground on fewer homes.
On a monthly basis, the rate of permits issued for new home construction was lower in 2025 than in 2024 for all but one month. August 2025 had the lowest issuance rate for residential permits since May 2020, one of the worst months of the pandemic-era slowdown in construction. Permit issuance rates have also remained low through the first month of 2026.
The annual rate of both housing permits and new home construction projects breaking ground (also known as housing starts) were far lower at the end of 2025 compared to the end of 2024. In December 2025, housing starts decreased by more than 100,000 homes compared to the year before.
Amid Trump’s tariffs, the home building construction industry also shed jobs. After rising in 2024, in 2025 the number of jobs in residential construction fell far below the 2024 average number of jobs in this industry. As shown below, jobs in this industry have remained low through February 2026, and were down nearly 60,000 jobs from December 2024.
On-the-Ground Impact: Uncertainty in the market causes delays, increases costs, and freezes buying and selling The Joint Economic Committee – Minority conducted outreach to local and national housing market stakeholders, including affordable housing developers, builders, and realtors. Multiple leaders raised concerns about higher input costs and how Trump tariffs will impact future home prices. They also discussed challenges that have come with not knowing what the tariffs will be from one day to the next. As Trump has implemented and changed various tariffs, there has been additional uncertainty regarding how much prices rise as a result. This uncertainty has continued into 2026, as Trump announced a new set of tariffs to replace those that were deemed unconstitutional by the Supreme Court. Meanwhile, Trump’s tariffs on steel and copper – which significantly impact the housing industry – were unaffected by the Supreme Court decision and remain in full force.
“In 2024, nearly $80 billion in construction and housing goods—including building materials, home systems, bathroom fixtures, kitchen appliances, utility appliances, and more— were imported. Tariffs drive up the costs for those materials and goods, which increase the cost for new constructions, housing stock preservation, and refurbishments. Those costs are passed on to homebuyers, homeowners, and renters. “In the midst of a housing supply and affordability crisis, increasing the price of any component of housing is shortsighted and counterproductive. We need an all-of government approach to address our nation’s housing supply and affordability crisis, and that includes materials costs, supply chain challenges, and workforce constraints.” - David Dworkin, President and CEO of the National Housing Conference
The inconsistency and unpredictability of the current tariff policies are making it harder for homebuilders to finalize budgets for home construction projects and break ground. Stakeholders who specialize in housing development expressed concern over the need to delay their projects in order to adjust financial plans, account for potential rising prices, and/or address challenges in their supply chains. Moreover, investors who provide loans to developers have requested to see more contingency funding in order to ensure that developers are prepared for price volatility. These delays themselves can also further drive-up project costs. Realtors are also facing uncertainty in the market. They have raised challenges related to tariffs’ role in higher costs across the board, which leave many people with less savings to purchase a home.
“Tariffs on imported building materials are driving up construction costs across the U.S., so everyone is feeling the pinch. But here on Long Island, where buildable land is limited, zoning is restrictive, and inventory is tight, the effects are even more pronounced. Every additional cost is magnified in a market already struggling with affordability.” - Mark Donnelly, Licensed Associate Real Estate Broker