Build Now or later?
Are you considering a home project or dreaming of building the perfect house—but feeling hesitant due to tariffs or high interest rates? You're not alone. Let’s break down what’s happening and how it could affect your plans.
The Impact of Tariffs on Building Materials
Steel and Aluminum
Currently, the U.S. imposes a 25% tariff on steel and aluminum imports from all countries, increasing the cost of many structural and decorative materials.
Currently, the U.S. imposes a 25% tariff on steel and aluminum imports from all countries, increasing the cost of many structural and decorative materials.
Lumber
Canadian softwood lumber is subject to a 14.5% anti-dumping and anti-subsidy tariff, which impacts framing, flooring, and many other aspects of construction.
Canadian softwood lumber is subject to a 14.5% anti-dumping and anti-subsidy tariff, which impacts framing, flooring, and many other aspects of construction.
Putting It into Perspective
According to the National Association of Home Builders (NAHB), here’s a simple example of how tariffs affect pricing:
According to the National Association of Home Builders (NAHB), here’s a simple example of how tariffs affect pricing:
If a retailer imports a $500 washing machine from a country subject to a 25% tariff, they owe $125 in tariffs to the U.S. government. What happens next?
1. "The retailer might negotiate with the supplier for a lower base price."
2. "They could absorb the cost and accept lower profits."
3. "Most likely, they raise the retail price."
4. "Or they use a mix of all three strategies."
The same principle applies to building materials—ultimately, those increased costs tend to reach the consumer.
How Tariffs and Rates Affect Home Building in Northern Virginia
Here are a few key ways these factors can influence your decision to build or remodel:
Reduced Affordability
Higher material costs can make new homes or renovations less attainable, especially for first-time buyers.
Higher material costs can make new homes or renovations less attainable, especially for first-time buyers.
Pressure on the Housing Market
Increased expenses may slow new construction, tightening the supply of available homes and driving up prices.
Increased expenses may slow new construction, tightening the supply of available homes and driving up prices.
Increased Material Costs
Tariffs on steel, aluminum, and lumber—often sourced from countries like Canada and Mexico—directly raise the cost of building.
Tariffs on steel, aluminum, and lumber—often sourced from countries like Canada and Mexico—directly raise the cost of building.
Higher Consumer Prices
Builders typically pass increased material costs along to the customer, which means higher quotes for home renovations or new construction.
Builders typically pass increased material costs along to the customer, which means higher quotes for home renovations or new construction.
What About Interest Rates?
As of May 7, 2025, average mortgage rates in Virginia are:
7.17% for a 30-year fixed mortgage
6.45% for a 15-year fixed mortgage
6.5% to 9% for a construction loan
Rates remain slightly elevated due to inflation and economic policy from the Federal Reserve—but they’re still within historic norms.
The Hard Truth
Here’s the reality: there’s never a “perfect” time to build. You may be waiting for lower construction costs or better mortgage rates—but what if that day never comes?
There will always be external factors to consider. Material and labor prices might remain stable, or they could continue rising. In our experience, no homeowner ever regrets investing in their space—but many regret waiting too long.
In Northern Virginia, home values are steadily climbing. On average, the Return on Investment (ROI) for remodeling projects in this area is roughly 150% or more. That’s not a bad investment at all.
Ready to Build Your Dream Space?
Don't wait for the "perfect" time—create it. Contact us today to get started on your home project.
Don't wait for the "perfect" time—create it. Contact us today to get started on your home project.
by Kelley Davies | May 7, 2025