DES MOINES, Iowa -- On Monday the Trump Administration imposed 200 billion dollars-worth of tariffs on Chinese products, further escalating the trade war between the two countries. 10 billion dollars will directly impact the home-building and renovation industry.
The new round of tariffs will impact Chinese made products like flooring, appliances, and kitchen cabinets.
“Most of the wood does come from China, some of the ceramic, laminates, the luxury vinyls, a lot of the hard surface does come from there” said Nick Mehalovich, a sales rep for Louie’s Flooring.
Companies like Louie’s say if they want to continue providing the same prices to clients, they'll have to take the hit, and they're confident they can do it.
“We just take a little bit less of a percentage you know? We don't want to scare off the customers so, being a family-owned business, we don’t have a lot of overhead here so we can take that” said Mehalovich.
The tariffs start at 10% and by January 1 it jumps to 25%. Home-builders like Don Brill say this tariff in particular is not likely to drastically increase costs of building a home for consumers, but it is adding on to increasing costs of lumber and labor.
“Those costs are increasing a lot higher than the tariffs we're going to see coming from China. I don't think the tariffs that were imposed yesterday are going to have that big of an increase. I think a lot more on the commercial side of it then on the residential side because it's at a minimal scale of what product we're getting” said Brill.
A spokesperson for Hubbell Realty says it's too early to for them to comment on the kind of impact they will feel on larger scale construction projects.
When it comes to Real Estate as a whole, realtor Lance Hanson says homeowners who are planning to remodel may face more of a decision compared to builders.
“I would assume that they would just look at ways to remodel less and not put as much stuff in. It just depends on the products and the availability from someplace else is going to be huge” said Hanson.
Hanson says the added cost of some products will compound with a lack of supply due to several large-scale natural disasters in the country taking up inventory.
He says costs of home-building were already increasing before the tariffs, going up about five percent a year.