American shoppers browsing for a new sofa or hardwood flooring this week might be startled by sticker shock, and not just because of inflation. Beginning Tuesday, new tariffs on imported furniture and lumber are taking effect, with sweeping consequences for families, small businesses, and the larger housing economy. While official announcements promote these moves as leverage in international trade, the bottom line for many U.S. households is rising costs, sometimes with little warning or explanation¹.
According to analysis released by Goldman Sachs, American consumers are on track to absorb 55% of the costs from President Donald Trump’s latest round of tariffs by the end of this year. These levies, once pitched as a penalty aimed at foreign exporters, now land squarely on the household budgets of everyday Americans. The math trickles down to the checkout aisle: of every $100 in new tariff costs, $55 ends up paid by consumers, $22 by American businesses, $18 by foreign exporters, and about $5 is evaded or mitigated by other means.
Industry experts and independent economists say that this latest volley, 10% on lumber and 25% on furniture, complicates an already fragile housing market. Builders facing higher lumber costs pass those expenses into new home prices, sometimes making the dream of home ownership even more costly or out of reach for those on the margins. For small business owners in furniture or home improvement retail, narrower margins make it harder to compete and plan for the future.
While the White House maintains that these tariffs will ultimately be a temporary phase, intended to incentivize domestic production and make international partners reconsider their trade policies, on-the-ground reality is more immediate. The price of everyday household items from couches to cabinetry, many of which rely on both imported components and finished products, has already started to rise. This is not an abstract economic metric, but something consumers are experiencing at the register and noticing in home project estimates.
The effects are especially sharp for those who spend a larger share of their income on goods that are now tariffed. Lower- and middle-income households, whose budgets are most vulnerable, face what some experts refer to as a “regressive tax”, one that hits the less affluent harder. Economists project that as the year progresses, the share of tariff costs passed onto consumers could climb even higher, with Goldman Sachs warning it may reach 70% in the next year.
American companies, from the nation’s biggest retailers to Main Street stores, are also feeling squeezed. Businesses often have little room to absorb the increased cost of imports, and for many, the only practical response is to raise prices. Some are also diversifying suppliers or attempting to shift sourcing within the U.S., but these moves take time and often still result in pricier end products. As companies revamp supply chains to adapt, that operational expense cycles back to consumers through higher costs and reduced discounting.
The broader economic climate compounds these pressures. Ongoing inflation, tightening access to credit, and surging demand for housing supplies have already squeezed household finances. The tariffs act as an added tax, invisible but real, baked into the final price of goods with little recourse for consumers. Economists from S&P Global and the Federal Reserve Bank of St. Louis both find a quantifiable link between recent tariff increases and a modest but noticeable jump in U.S. inflation.
For industries adjacent to furniture and lumber, like home renovation services, logistics companies, and even rental markets, the ripple effects are already apparent. Demand shifts as consumers postpone purchase decisions, substitute goods, or scale back remodeling plans, sometimes with far-reaching consequences for local economies. Canadian suppliers, tasked with recalculating their own business models in response to new barriers, are watching closely as shifts in U.S. demand affect cross-border trade, though the direct impact for U.S. buyers centers on everyday affordability.
Even for those with flexibility in their budgets, it’s hard to ignore when tariffs move out of abstract policy debate and show up in the weekend shopping trip, or in the final cost of a home you hoped to buy. While politicians and economists can debate tariff theory and trade leverage, many Americans are confronting the result in their receipts and monthly bills, one incremental expense at a time.
