The price to build a home isn't going down any time soon.
Duties on Canadian softwood lumber are expected to increase 20% even before President Donald Trump places any new tariffs on the sector.
KC Shermack owns Pillar Homes and is a Builders Association of Minnesota board member.
"Families need houses," says Shermack. "Families need additions. Families needs changes and the unknown that comes with the tariff situation causes hesitation for something that you hope that they won't postpone because they've been planning for it."
Shermack doesn't expect to see much of a decrease in the number of homes being built in Minnesota despite rising costs.
"It will just cause another way of approaching the house as far as, either the size, the amenities, and the details," he explains.
The National Home Builders Association expects tariffs to increase the average cost to build a home by about $9,000. As of early April 2025, the median home price in Minnesota is already around $343,000.
Shermack says 7% of what's used to build a house in Minnesota comes from another country, with lumber being the largest part of that.
"Most of the lumber that goes into the homes that are built because you can't build a home in China," Shermack said. "You got to make it where you live and where you build. We do about 85% of that, coming from Canada, 85% of what are called soft woods."
For anyone exploring building a new home, Shermack does have a little advice to keep costs down.
"You have to get as creative as possible when it comes to the house itself," he explains. "I think instead of people not doing homes, they might just value-engineer them either on size - so reduce the size slightly - or postpone the completion of something."
Last week, Bloomberg reported the U.S. was poised to more than double duties on Canadian softwood lumber to 34.45% as part of a new round of tariffs announced by the Trump Administration. That would put more pressure on U.S. materials costs.
So far, Trump has threatened, but not yet imposed, further import taxes on lumber. The president has ordered a national security investigation into US imports of wood and has said the US doesn’t need Canada’s. But US homebuilders have warned that more tariffs will only drive up the cost of new housing.