Published by FOX Business | February 19, 2025
President Trump has pursued a number of tariffs in recent weeks
Tariffs recently announced by President Donald Trump causing worry among U.S. homebuilders.
Those concerns come after the president has pursued a slew of tariffs in recent weeks, including moving to reinstate a 25% tariff on steel imports and lift the levy on aluminum imports back to 25%.
Trump also previously announced 24% tariffs on imports from Canada and Mexico and a 10% tariff on imports from China; however, the levies targeting Canada and Mexico have been paused until at least early March.
On Tuesday, the National Association of Home Builders/Wells Fargo Housing Market Index for single-family housing showed a five-point drop in builder confidence month-over-month, hitting 42 in February.
That, according to the NAHB, was below the index’s 50-point benchmark for positive sentiment and the “lowest level” it has reached in five months.
Homebuilder sentiment for current sales conditions came in at 46 for February, marking a four-point drop from the prior month. Other data from the HMI indicated they feel negatively about prospects for sales in the coming six months, with their expectations for that also hitting 46.
“While builders hold out hope for pro-development policies, particularly for regulatory reform, policy uncertainty and cost factors created a reset for 2025 expectations in the most recent HMI. Uncertainty on the tariff front helped push builders’ expectations for future sales volume down to the lowest level since December 2023,” NAHB Chairman Carl Harris said in a statement.
Applications to build new privately-owned housing came in at a seasonally adjusted rate of 1.48 million in January, marking a 0.1% decline from the prior month, according to new U.S. Census Bureau data released Wednesday.
Meanwhile, housing starts dropped 9.8% from December to a seasonally adjusted annual rate of 1.37 million. For single-family housing in particular, the rate was 993,000 in January, down 8.4% from December.
Trump’s steel and aluminum tariffs are slated to come into force in mid-March.
