Tariffs and Steel Costs Squeeze Central Ohio Builders, Threaten Affordable Housing

Construction costs across Central Ohio are climbing again, and builders say tariffs on steel, aluminum and copper are a big part of the reason. Aluminum has jumped 45 percent year-over-year, copper is up 36 percent, and U.S. hot-rolled coil steel has increased 27 percent, according to figures reported by Columbus Underground. On top of that, structural steel, aluminum, steel racks, furniture parts and aluminum lithographic plates all now face a 50 percent tariff rate, though some tariffs were lowered in June 2026.

The report, written by Columbus Underground's Brent Warren, found that construction costs are rising nationwide even as national construction demand stays soft. In Central Ohio, the picture is different: demand is treading water rather than softening, according to the report, which means local builders are absorbing higher material costs without the cushion of a slowdown in projects competing for labor and supplies.

Tariffs, War and Immigration Policy All Named as Cost Drivers

Real estate services firm JLL identified several forces pushing building costs higher, per the same report: tariffs, a labor shortage linked to the Trump administration's immigration policies, and rising energy costs tied to the war in Iran, which is driving up energy costs for site operations, transportation and the production of energy-intensive materials internationally. JLL projected that building costs will increase 8 percent by the end of 2026, after already rising 5 percent since the start of the year.

Those national pressures are landing squarely on Central Ohio, where construction costs are rising similarly to the rest of the country. Tod Bowen, executive officer of the Building Industry Association of Central Ohio, said the national data lines up with what he's hearing directly from local builders. Construction input costs here have increased because of both materials costs and a highly competitive construction labor environment specific to the region, the report notes.

Small Builders Bear the Brunt

Research from the National Association of Home Builders found that smaller builders are being hit harder by material cost increases than larger firms, a pattern echoed nationally by the trade group's survey data showing median building material costs rose 6.7 percent year-over-year. That imbalance matters in Central Ohio, where affordable housing developers can't lean on the bulk-purchasing power that helps larger production builders soften the blow.

Homeport, a local affordable housing developer, has experienced construction cost highs over the past several years and into 2026. Leah Evans, the organization's president and CEO, who also sits on the Building Industry Association of Central Ohio's board, said JLL's construction cost figures reflect what Homeport has seen in its own projects. The organization is projecting modest price increases for new deal development into 2027, and those increases are already making the delivery of affordable rents more challenging.

Regulation Adds to the Bill

Beyond tariffs and materials, government regulation is also increasing costs for the construction industry, according to the report, with building code requirements cited as one contributor. The zoning process itself creates development costs, an issue Columbus officials have begun addressing separately through the city's ongoing “Zone In” initiative to modernize its zoning code.

The strain isn't limited to private housing developers. Powell's Olentangy Environmental Control Center expansion, a public infrastructure project, wrapped up construction this month at $46 million — six million dollars over its original $40 million budget — after Hoodline's prior reporting detailed how nationwide material price surges and supply chain delays drove up the tab. It's a local case study of the same cost pressures now weighing on private builders across the region.

Central Ohio remains a growing community, and demand for new housing hasn't let up even as the cost of building it keeps rising. For builders like Homeport working to keep rents affordable, and for the broader construction industry navigating tariffs, labor competition and regulatory costs all at once, the report's message is that the squeeze isn't easing anytime soon.