HOUSTON – In a move that has stirred both relief and uncertainty, President Donald Trump announced a temporary pause on the 25% tariffs imposed on goods from Canada and Mexico, just two days after they went into effect. However, tariffs on Chinese imports remain unchanged, leaving local businesses in Houston grappling with the implications.
Gilbert Okoronkwo, a real estate developer with properties across Houston, highlights the challenges faced by developers.
“Things you see, like doorknob handles, flooring, all that stuff. It is not made in America for the most part,” Okoronkwo explains. “So that’s what concerns us, because it’s literally can impact every single, almost every single bit of this construction project.”
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Despite purchasing from American companies, many of the components are manufactured abroad, making them subject to tariffs.
In February, the National Association of Home Builders said 25% tariffs would raise construction costs and housing affordability.
“Tariffs on lumber and other building materials increase the cost of construction and discourage new development, and consumers end up paying for the tariffs in the form of higher home prices,” said NAHB Chairman Carl Harris in February. “NAHB urges the administration to reconsider this action on tariffs, and we will continue to work with policymakers to eliminate barriers that make housing more costly and prevent builders from boosting housing production.”
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While the president has paused the tariffs on some goods from Mexico and Canada, Okoronkwo notes that the uncertainty surrounding is causing headaches for the industry.
“From a business perspective, we have to consider that risk and put that into our cost. And, you know, that’s something ultimately, we have to push down on to the consumer,” he says.
Similarly, Brent Brugliera, director of operations at American Art Resources, a Houston-based company that supplies art pieces to hospitals, hotels, and offices, is experiencing delays due to the tariff uncertainty.
“Usually, I get my prices by now,” Brugliera said. “So, I’m still like waiting for the majority of my pricing to come in. And, you know, I’m speculating that they’re waiting to see what their costs are going to be before they kind of make that gamble on what they pass on to me.”
The pause on tariffs provides a temporary reprieve, but the ongoing uncertainty continues to affect business operations. Brugliera points out that the situation is exacerbated by recent inflation and the lingering effects of the COVID-19 pandemic.
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“I think the thing that maybe has made it a little bit worse is, you know, we’re just coming off inflation too. So, people have already done a price increase. And then COVID, you know, there was a little bit of a lag there. But so, it’s like, how much more can the market handle?” he questions.
Both Okoronkwo and Brugliera are considering sourcing from companies within the United States to mitigate the impact of tariffs. However, they acknowledge that this could lead to higher costs, which would ultimately be passed on to consumers.
As the situation unfolds, Houston businesses continue to navigate the challenges posed by tariff changes, seeking ways to adapt and maintain affordability for their customers.
