Oregon math teacher moves forward with home improvements despite tariffs. Here’s why

Southern Oregon college math teacher Doug Gardner pays attention to costs, especially as he’s finishing the house he’s building for himself in Shady Cove.

“There’s excitement when interest rates go down and sticker shock when the price of materials rise,” he said. “You can try to get the timing right, but life goes on,” and costs generally go up while the need for improvements remains.

In many cases, he sees benefits in upgrading the livability of a home even if certain materials are more expensive due to import tariffs and other factors. He’s helping a friend build a sauna, and the cost to use cedar from Canada has gone up $300.

He looks at it this way: No one wants to pay more, but it’s a fraction of the total expense. “Do a satisfaction survey in your mind and ask, ‘is it worth it?’” he said.

Then do the math. If it costs $1,000 more to not compromise, a home improvement loan for that amount over five years at 10% breaks down to $20 a month, said Gardner, who heads Rogue Community College’s mathematics department and, in his spare time, drafts detailed construction technical drawings for people who want a new house or to remodel.

“Your home is such a big part of your life,” he said. “There’s a value in enjoying it more.”

People who have planned for a major home improvement, to upgrade a kitchen, make the living space easier to navigate or add on to welcome a new member of the family, may be having second thoughts with tariffs on imported goods bumping up their original budget.

Matt White, general manager of Portland-based Neil Kelly remodeling-design company, calms his clients’ concerns by explaining that only part of a construction project may have an additional tax.

“Don’t hear about a possible 40% tariff on imported lumber and think the whole project will cost 40% more,” said White, whose company uses U.S.-made products as much as possible.

The estimated cost for a remodeling project includes labor and materials, and imported products may be affected by tariffs. “With labor half of the cost and the use of non-imported materials, in the end, the project may go up 1-2%,” said White.

He said a typical kitchen remodel doesn’t involve a lot of lumber and with a large room addition, less than 20% of the project cost is in lumber.

A February announcement of 25% tariffs on imports from Mexico and Canada has so far resulted in Neil Kelly paying 5% more for one brand of Canadian-made cabinets.

White advises people to take it slow and not rush toward a less expensive alternative.

If you love the outcome five years from now, you will forget that the cost of one product went up, he said. “But you don’t want to think back,” he said, “and say, ‘oh gosh, I wish I had spent a few more dollars to get the appliance or counter top that I really loved.’”

Tariffs in remodeling

A recent nationwide survey by Houzz, an online resource for home remodeling and design, found that residential construction and design professionals anticipate tariffs on imported lumber, plywood, steel, flooring, aluminum and windows will costs consumers more.

The National Association of Home Builders hopes there will be more domestic timber output since tariffs on Canadian lumber shipments into the U.S. are expected to more than double by September.

Tariffs of 25% on all steel and aluminum imports went into effect March 12.

Prices are also likely to increase the cost of imported appliances, cabinetry, lighting and plumbing fixtures, as well as indoor and outdoor furniture, according to the latest Houzz U.S. Renovation Barometer.

Of the more than 1,000 owners of residential construction, architecture and design companies who responded to the Houzz survey, nine in 10 anticipate a negative impact on their business in April, May and June due to market shifts.

Both construction and design sectors expect moderate to severe labor shortages, particularly among general laborers and finish carpenters, the survey found. Shortages of framers and plumbers are also notable concerns.

Respondents, who were questioned March 14-28, expect about 26% of their clients will delay projects.

The tempered outlook in the second quarter of the year is spurred by expectations of a dip in project inquiries and new committed construction projects, said Houzz staff economist Marine Sargsyan in a news release. But she said the design sector’s activity may remain stable and build-only remodelers expect an uptick in activity.

”Firms continue to navigate challenges including rising material costs, cautious client spending and persistent labor shortages,“ Sargsyan said. ”In response, many firms are proactively adjusting procurement strategies and selectively stockpiling materials in preparation for anticipated tariff-driven price hikes, especially on lumber, steel and cabinetry.”

Softening the impact

White of Neil Kelly reassures his clients that planning a remodel takes time — 90 days for a typical kitchen remodel before hammers and new hardware hit the scene. “This allows people to make decisions they will love for a long time,” he said.

At each of about six meetings, clients are shown ideas and materials, and told the price of their first option, which could be subject to an import tariff, and non-tariffed alternatives, said White.

Neil Kelly is aligned with Natural Step’s ecological approach and sources non-imported materials, as much as possible, within a 500-mile radius of their project managers in Portland, Eugene, Bend and Seattle.

Material vendors keep Neil Kelly informed on changes, White said, and his company’s trade contractors, like plumbers, electricians, dry wallers and tile setters, have not increased their rates.

Neil Kelly has weathered unpredictable prices before. The company was founded in Portland in 1947 with a $100 investment and has survived recessions in 1973-1975, 1981-1982, 1990-1991, 2001 and the Great Recession of 2007-2009.

No matter what happens in the global economy, people need to make repairs and remodel for many reasons, White said, and often find investing in their existing home more affordable than buying a different dwelling.

During the pandemic years that started in 2020, the cost of labor and products spiked, and there were supply chain challenges. Yet demand for home improvements skyrocketed as people spent more time at home and tapped into low interest rates.

Room additions and whole house projects, especially for multi-generation living, more than doubled during the pandemic, White said.

He promotes a positive approach to unknown changes. “Don’t think, ‘what are they doing to us?’ but instead ‘what are the opportunities?’” he said.

Today, although contractors are busy, they are not overwhelmed as they were three years ago, and people are receiving more attention, White said.

Taking it slow is the right course, he said. A lot can change between now and when a project starts in June or July.

“The key, as always, is to stay organized through the process of putting concepts together, selecting the right products and making sure everyone is comfortable with everything before signing on the dotted line,” White said. “We have to be prepared and look for alternatives, but it’s better to absorb an increase than to rush in and make a mistake.”

— Janet Eastman covers design and trends. Reach her at 503-294-4072, [email protected] and follow her on X @janeteastman.