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Tariffs, natural disasters are driving up construction costs in Florida: report

A new report by BuildFax found that home maintenance construction costs in Florida increased 13 percent in June, year-over-year
By Keith Larsen | July 17, 2019 06:00PM

New homes in Florida (Credit: iStock)

New homes in Florida (Credit: iStock)

This has been a rough year for Florida’s housing market.

A new report by BuildFax found that existing home maintenance construction costs in Florida increased 13 percent in June, on a year-over-year basis.

Buildfax’s CEO Holly Tachovsky said via email that natural disasters could have driven up some of the costs in Florida and made it more difficult to find workers. Nationally, she said tariffs on construction materials like steel and lumber are driving up construction prices.

Rising construction costs have become a major challenge for developers and homebuilders. Federal Reserve Chair Jerome Powell even made this point last week and suggested that Trump’s tariff and immigration policies are making homebuilding too expensive.

Nationally, single-family housing permit authorizations decreased by 2.75 percent in June, year-over-year, according to BuildFax. Meanwhile, existing housing maintenance spending decreased by 0.75 percent year-over-year.

The report did not break down specifics by region within Florida. But the construction concerns could be greatly affecting South Florida, where home prices have risen much faster than income levels. With construction costs in South Florida rising, it could make home buying even more expensive.