How Tariffs Are Disrupting Residential Construction and What Builders Can Do About It
Tariffs are quietly reshaping residential construction. And if your costs have crept up or cash flow feels tighter than ever, you’re not alone.
That was the dominant theme at this year’s Construction Financial Management Association (CFMA) Annual Conference in Kissimmee, Florida, where the Hyphen Wallet team joined construction finance leaders to dig into the numbers behind the disruption. Across the board, Builders are seeing the ripple effects of rising material tariffs—from inflated lumber costs to delayed shipments and tighter project timelines.
Learn how some Builders are responding to these disruptions with faster, more flexible payment solutions.
Understanding Tariffs: What Builders Need to Know
A tariff is essentially a tax imposed on imported goods. When applied, it increases the cost of bringing these products into the U.S. This added expense is often passed down the supply chain, ultimately affecting Builders and homebuyers.
A notable example is the tariff on Canadian softwood lumber, which stands at 14.5% and is projected to rise to 34.5% later this year. Given that Canada supplies about 85% of U.S. softwood lumber imports, this escalation directly impacts construction costs.
These rising costs not only strain Builders’ budgets but also affect housing affordability. As construction material prices increase, your team may need to adjust project scopes, seek alternative Suppliers, or pass costs onto buyers—slowing housing development and worsening the affordability crisis.
How Tariffs Are Creating Cash Flow Challenges for Builders
If your material costs have jumped this year, you’re not imagining it. When materials like lumber, steel, and appliances are subject to tariffs, prices go up—and that added cost is rarely absorbed by the Supplier. It’s passed along to you.
This raises construction costs across the board, forcing Builders to either shrink profit margins or raise home prices—neither ideal in today’s market. Over time, rising expenses create significant cash flow pressure, especially if you’re already managing multiple projects or tight budgets.
Cash flow management in construction becomes even more difficult as tariff-driven cost increases hit critical materials, and vendors expect faster payments. If you’re juggling multiple bids or managing tight budgets, even a slight delay or price hike can create ripple effects that are tough to recover from.
More Delays, Tighter Margins, Less Flexibility
With tariffs inflating the cost of key materials, a product suddenly costs more meaning you’re forced to wait or pay a premium to move forward.
That unpredictability makes it harder to budget, forecast, and stay on schedule. Tighter margins mean less room for error—and less flexibility when something unexpected hits, like a weather delay or labor shortage.
Why Traditional Payment Methods Make It Worse
Most Builders still rely on slow payment processes in construction, like paper checks or manual ACH transfers. These methods are slow, fragmented, and lack real-time visibility. When your team is under cash flow pressure, delays in approvals, mail delivery, or bank processing can stall a project.
We covered this growing issue in more detail in our recent blog, The Evolution of Cracking Down on Checks — see how your team can modernize outdated payment methods and reduce delays.
Paper checks and manual ACH transfers can take days—or even weeks—to clear, tying up critical funds you need to pay Vendors or order materials. This delay can restrict cash flow and, in some cases, extend your project timeline. This is exactly the kind of challenge Hyphen Wallet was built to solve. Hyphen Wallet accelerates accounts payable and receivables, giving you faster access to your funds with expedited methods — so payments go out on time, materials arrive when needed, and your schedule stays on track.
Why Cash Flow Is the #1 Builder Priority Right Now
In a market with rising costs and shrinking margins, protecting cash flow is essential. Your ability to keep projects moving, pay Suppliers and Vendors on time, and respond to changes–depends on how well your team manages payments.
Builders using digital tools and automated payment systems are gaining a competitive edge. They control timing and make faster financial decisions, a key advantage in an unpredictable economy.
How Hyphen Wallet Helps Builders Stay Ahead
Tariffs aren’t going away—and neither are the financial pressures they create. That’s why Hyphen Wallet was built specifically to help the construction industry stay financially flexible and keep jobs moving, even as costs rise.
Instant, Secure ePayments = Faster Project Funding
No more delays from paper checks or slow ACH. Hyphen Wallet enables real-time payments for construction, so your Vendors and Subcontractors get paid quickly. Accelerated payments and receivables keep cash flowing—helping you fund the next phase without delays. Ready to speed up your payments? Request a demo today and see how Hyphen Wallet can transform your cash flow.
Virtual Cards: Speed, Security, and Single-Use Simplicity
Hyphen Wallet’s Virtual Card capabilities enable faster transactions and offer built-in fraud protection—so you stay efficient while your Vendors get paid in seconds.
Gain Visibility and Control Over Cash Flow
Track every transaction on one platform. With Hyphen Wallet, you gain real-time visibility into your payment pipeline and improve your ability to manage cash confidently.
Future-Proofing Builder Finances in a Tariff Economy
Tariffs and rising material costs aren’t temporary trends. Builders who want to stay competitive must modernize their financial processes—starting with how they pay and get paid.
What Builders Need in a Payments Partner
You need more than just software. You need a partner who:
- Understands construction workflows
- Offers real-time payment visibility
- Reduces Fraud risk and increases security
- Provides expert support when it matters most
Why Automation and Flexibility Are the New Standard
Manual payments cause delays and increase risk. With Hyphen Wallet, you get:
- Speed: Instant and same-day payments
- Automation: Streamlined AP and AR
- Risk Mitigation: Increase security with verification and tracking transactions, reducing fraud risk
Get Started with Hyphen Wallet
Hyphen Wallet helps you simplify payments, protect cash flow, and stay ahead—even in a volatile economy. Less paperwork. More progress. Better Cash flow.
Ready to move forward?
Request a demo to see how Hyphen Wallet keeps your projects funded and on track.
References
- NAHB – Tariff Uncertainty and Its Impact on Home Building (2025)
- NAHB – How Tariffs Impact Home Building (n.d.)
