Solving the Post-Close Challenge with Intelligent Automation

Join our upcoming webinar as SoftWorks AI CEO and Avanze CEO explore the advances in tech that allow for greater levels of automation and cost reduction, especially in support of post-close and pre-fund review.

Spruce’s Patrick Burns on innovation in title technology

In the season finale of Housing News season 5, Spruce CEO discusses heightened investor interest in title tech, innovation and fintech adoption.

The 100-years-war over real estate commissions

HousingWire plunges down the rabbit hole of residential real estate commissions, uncovering the past, present and future of this wholly unique part of the economy.

How borrower education can make housing more attainable

The current housing market is making it difficult for prospective buyers to afford a home. Housing professionals need to find ways to better meet buyer needs.

Real Estate

CNBC: Chinese tariffs are going to make your home renovations more expensive

NAHB claims there could be a $2.5 billion tax increase on the industry

This year, the National Association of Home Builders’ Remodeling Market Index revealed that in the fourth quarter of 2017, the RMI reached 60 for the second time since 2001.  

Although the demand for home renovation has continued to increase in 2018, recently imposed tariffs are expected to reduce affordability for homeowners seeking renovations, according to an article written by Diana Olick for CNBC.

As of today, President Donald Trump has imposed a 10% tariff on $200 billion of Chinese imports. The Chinese are expected to retaliate with a 5 to 10% tariff on $60 billion of U.S. exports, according to Capital Economics.

According to Olick, NAHB claims that about $10 billion worth of Chinese products are exclusive to home building and remodeling.

Furthermore, the tariff starts at 10% and could potentially increase by 25% by the end of 2018. The NAHB notes this could be the equivalent of a $2.5 billion tax increase on the industry, according to the article.

From the article:

Contractor Justin Sullivan manages home renovation projects in the Washington, D.C. area and says costs are going up so much so fast that he is doing something he has never done in his more than a decade in the remodeling business.

"Clients and contractors are having to set contracts with escalation clauses for projects that are being scheduled for six months from now, largely because we're not sure how far prices are going to go north," said Sullivan.

Sullivan says it is a quick education for new clients, who were already fighting to get projects scheduled, given the high demand and labor shortage. Higher home values have given homeowners more ready cash and more incentive to improve their investment. Now his clients have one more worry.

Last year, the homebuilding industry took a tremendous blow when Trump imposed tariffs on Canadian softwood lumber.

Since then, homebuilders have struggled to stay afloat in market navigating affordability concerns.

“The prices of land, labor and lumber continue to spike, and while builders have largely proven able so far to deliver homes at prices that are accessible to many buyers, buyers will ultimately bear the brunt of those rising builder costs,” Zillow Senior Economist Aaron Terrazas said.

For the remainder of the year, homeowners looking to renovate homes may have to dig a little deeper into their pockets. 

Most Popular Articles

Fannie and Freddie set dates for their new refi option

Fannie and Freddie revealed new dates for their refi options targeted to low-income borrowers set to be available this summer.

May 05, 2021 By

Latest Articles

What a dismal jobs report means for the housing market

April’s U.S. jobs report on Friday was dismal at just 266,000 new jobs, but economists say they’re not worried about the housing or mortgage market. HW+ Premium Content

May 07, 2021 By
3d rendering of a row of luxury townhouses along a street

Log In

Forgot Password?

Don't have an account? Please