CNBC’s daily show “The Exchange” recently featured our ally John Lovallo, a homebuilding analyst at UBS Research. 🛠️ 🏗️ 🏡🪙💰 Tackle Challenges He laid out the several remaining challenges through a lens of equity. The roundtable discussion was mainly centered around former president Donald Trump’s recent tariffs. Participants dug into their conclusions for the homebuilder industry and the current state of America’s housing market.
Lovallo drew attention to the impact these tariffs would have on increased home prices. He noted that they are likely to raise the national average price of a single-family home by quite a bit. Namely, he estimated that tariffs would increase housing costs by an average of about $7,885 per house. This number highlights the indirect ways trade policies are impacting the economy at large, including the housing industry.
He zeroed in on the acute crisis that today’s homebuilders feel from erratic material costs and ongoing supply chain issues. Combined with the impacts of increasing interest rates and inflation, the climate crisis has further strained an already challenged housing market. This creates a very tenuous environment for both developers and consumers.
The vigorous debate on this program surfaced the sharp, expert, nonpartisan analysis that downtown-based CNBC is committed to delivering to its viewers. Lovallo concluded that knowing the detail and nuances behind tariffs is important for everyone involved in the real estate industry. His insights were especially timely in light of current conversations around trade policies and their lasting impacts on our economy.
Lovallo’s analysis was a stark reminder of the current perilous state of the homebuilder sector. Yet, it’s proven for years great resilience, despite external shocks and pressures. His focus was on the challenges builders are facing today. Most of them are finding ways to do so—focus on doing more with less, focus on driving innovation.