High Price of Lumber Tariffs Hammer Builders and Buyers in North Texas

Some builders in North Texas are absorbing the extra cost of lumber, but for others the burden is too heavy to bear.

Last year’s 20 percent lumber tariff turned into a 60 percent price hike on lumber across the country so builders in North Texas are concerned about the increase in price and what it means for home buyers and the entire industry.

“Here in North Texas most of our lumber comes from the southern United States. It’s southern yellow pine. Overall in the U.S., 30 percent of our lumber comes from Canada. We shouldn’t see a 60 percent [price] increase across the board,” said Phil Crone with the Dallas Builders Association.

“The price of lumber is fluctuating, but it is still high. Even if you are walking into a hardware store looking for a 2 x 4 for a weekend remodeling project, you’re paying a lot more, and it’s all a result of these tariffs.”

Some builders in North Texas are absorbing the extra cost, but for others the burden is too heavy to bear.

“I’m a custom home builder, so I can absorb a lot of the extra cost,” said Michael Turner of Urban Classic Homes.

Turner has been in the construction industry for 32 years and now runs his own company.

“Currently I have two homes under construction and two more in design that will start in the next 30 days, but if you’re a builder with dozens of projects, the lumber costs will be too high to absorb," Turner said. "On those entry level homes, you’ve got people that are right there on the line of qualification. So when you tack on $8,000 to $10,000 on a home for lumber, you price a lot of people out of the market.”

In the last ten years, the North Texas housing market went from The Great Recession, to a great demand to build more homes, but the price of lumber has impacted the affordability for buyers.  

“I mean, why are people moving here? It’s not because we have great mountains and great beaches. It’s because we have really affordable place to live and a great place to business," Crone said. "The affordability, the more that wanes, the less competitive we get, and lumber has a big part of that right now. That is my biggest concern, that our region will lose that affordability factor and make us less competitive."

Builders are hoping the NAFTA trade deal include the reconstruction of tariffs on lumber.

“I hope the trade deal is renegotiated. They have to get this problem solved with lumber," Crone said. "It’s the impetus for the profit taking from these big lumber companies. It’s really at the heart of all of these price increases we’ve seen.”

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