Proposed Tariffs Threaten to Deepen Central Ohio's Housing Shortfall, Builders Warn

Central Ohio's housing shortage shows no sign of easing, and proposed tariffs could make it worse, according to the region's home building industry.

Jon Melchi, executive director of the Building Industry Association of Central Ohio, said the region should be building between 17,000 and 19,000 homes a year. Builders fell short of that again this past year, completing slightly more than 10,000 homes. Because the gap compounds annually, Melchi put the current deficit at 7,000 to 8,500 homes.

Melchi attributed the shortfall partly to zoning restrictions. "The biggest challenges that we have are finding communities that will quite simply allow residential development to occur in a way that is meaningful," he said. He added that infrastructure problems, including water and sewer issues, have also held back construction across the region.

New homes in the Columbus area also cost more than in comparable markets. Data from the housing research firm Zonda show the median closing price for a newly built home in Columbus reached $497,450. That compares with $419,945 in Nashville and $375,000 in Indianapolis, both of which also build more homes each year.

Melchi said the limited supply means fewer people can afford to buy, and with inventory already low, prices have risen for both new and existing homes. He said the deficit affects buyers at every level. "Right now we're not building enough at any price point," he said, urging that housing affordability and creation become a focal point of economic development as central Ohio attracts new jobs.

Tariffs could add to the pressure. In 2023, the United States imported about 28 million cubic meters of lumber from Canada, nearly 70% of all its lumber imports. That wood is used mainly in residential and commercial construction. Melchi said estimates suggest the proposed tariffs could raise the cost of a home by $7,500 to $10,000. In the region, he said, every $1,000 increase in a home's price prices out about 1,000 people, so the effect "could have a significant impact."

President Trump suspended tariffs on Canada and Mexico on Thursday, but Melchi said uncertainty remains. He noted that the industry has been through earlier tariff disputes and the supply chain disruptions of the COVID period. "Our industry has gotten very good at uncertainty," he said.

That uncertainty makes planning difficult for central Ohio construction companies. With building volumes lower, firms have chosen not to stockpile materials that might become more expensive. Melchi pointed to the whiplash of last month, when tariffs were set to take effect and then, by mid-afternoon, were not.

His expectation is that builders will keep their heads down, monitor developments, and be ready to adjust prices and absorb cost increases as needed.