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Related Group CEO Jon Paul Pérez. Courtesy of Future Proof and Triangle BLVD Building contractors are already hiking prices as much as 20% to offset potential tariffs, a move that could also raise prices of new condos and homes, according to the CEO of developer Related Group. President Donald Trump has imposed 25% tariffs on certain goods from Canada and Mexico, including steel and aluminum, and is expected to follow through on broader tariffs starting on April 2. Even before those wider levies take effect, uncertainty over tariffs and inflation is causing many contractors to hike real estate project costs. Related Group CEO Jon Paul Pérez said contractors bidding on seven projects that Related has in the works are raising prices. “We’re seeing [subcontractors] throw an additional cushion into their numbers anticipating tariffs,” Pérez told CNBC during a live Inside Wealth conversation. “It could be as much as 20%, depending on what material they’re getting from another country.” Get Inside Wealth directly to your inbox Pérez said the price hikes are driven by the anticipation of higher costs, rather than current levels, and noted it’s unclear how the higher costs will be divided between contractor and developer. “When you go through their numbers in detail and you start negotiating, you quickly find out they’re just sort of padding to protect themselves,” he said. As a result, tariff fears could add further upward pricing pressure on a housing market that’s already crippled by high prices and elevated mortgage rates. According to a survey from the National Association of Home Builders, rising prices for construction materials could add $9,200 to the cost of a typical home. Related Group is one of the largest and most prominent developers in the U.S., spanning affordable housing to luxury condo buildings, mainly in South Florida. The…

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Filed under: News - @ March 21, 2025 3:24 pm