Inflation has risen again in some industries, and recent figures show that tariffs are contributing to this trend. One industry affected is the construction sector in Florida.
Construction played a key role in Florida’s economy, accounting for 5.7% ($97 billion) of the state’s gross domestic product (GDP) in 2024. Taxwatch, Florida, has published an economic commentary entitled “Trends in Construction Material Costs.” This report is intended to inform taxpayers of current and potential future costs.
The construction industry includes a wide range of activities, from minor home repairs to home construction and complex commercial development. The industry forms several factors, including material costs, labor costs, supply chain stability, and overall market trends. Increased prices for individual inputs can have a significant impact on the total cost of production for contractors and “do-it-yourself” enthusiasts.
The five main materials used in commercial construction are concrete, steel, wood or wood, stone, and brick/masonry. The rising prices of these materials can lead to higher consumer costs.
This July, Florida reported daily about the potential impact of new tariffs on Florida’s economy. While 75% of the imported wood used in construction comes from Canada, a key element of casts, a key element of drywall, is origination from Mexico.
A related survey by the US General Contractors (AGC) found that 46% of Florida contractors identified material costs as their biggest concern. An increase in construction materials costs in Florida can increase the price of a home by about $10,000.
The Florida Department of Transport expects a 5-9% rise in construction costs. Another study estimates that Florida property costs will increase by 3-5% in 2025. Furthermore, rising material costs have already overrunning budgets of 4% on affordable housing projects, which has impacted the Live Local Act.
