San Diego Market Insights | Spring 2025
What’s Really Happening?
Rising home prices and tight inventory are top of mind—but there’s another layer impacting San Diego’s housing market: tariffs on imported building materials. Recent changes to trade policy are already pushing up costs and creating uncertainty for both custom builders and buyers.
In early April, homebuilder stocks pulled back as public companies revised their 2025 guidance due to cost risks. “Higher input costs will directly affect home delivery timelines and margin projections,” analysts told Yahoo Finance. Companies like Lennar, D.R. Horton, and PulteGroup all signaled rising procurement costs and supply delays.
These national moves echo what’s happening locally—custom builders in San Diego are adjusting timelines, simplifying designs, and re-pricing jobs as material volatility increases.
What’s Driving Costs Up?
🔧 Imported Materials Are Now More Expensive
Expanded tariffs on construction-related imports are driving up costs on
- European tile and stone
- Imported cabinetry and fixtures
- Glass systems and LED lighting
- Solar and smart home components
Material | Avg. Cost Increase | Cause |
Carrara Marble (Italy) | +32% | Tariffs |
European Glass Systems | +25% | Tariffs |
LED Lighting (Asia) | +21% | Tariffs |
U.S. Lumber | +4% | Local demand |
Custom Cabinetry (EU) | +18% | Tariffs |
Sources: Mansion Global (Mar 2025), Yahoo Finance (Apr 2025), Builder Magazine
👷 Labor Costs Remain High
On top of material inflation, San Diego’s chronic labor shortage continues. Builders are paying a premium for skilled labor, especially finish carpenters, tile setters, and electricians.
Year | Avg. Construction Wage (San Diego) |
2021 | $29.75/hour |
2023 | $34.40/hour |
2025 | $36.90+/hour |
Source: U.S. Bureau of Labor Statistics, Q1 2025
What It Means for Buyers & Owners
🏗️ New Builds Are More Expensive and Slower
Build Type | 2021 | 2023 | 2025 (Now) |
Standard | $325/sq ft | $370 | $410+ |
Semi-Custom | $400 | $460 | $505+ |
Custom Luxury | $550 | $610 | $660+ |
⏳ Average custom build timeline in 2025: 12–14+ months
🔄 Buyers and Builders Are Adjusting
- Opting for completed homes to avoid delays
- Simplifying finish specs to manage volatility
- Renegotiating supplier contracts to protect budgets
📎 Builders are already flagging increased risk on timelines and pricing in 2025 forecasts.
(Yahoo Finance, Apr 2025)
The Bottom Line
Newly expanded tariffs are now directly influencing project budgets and schedules—especially in custom homebuilding and luxury remodels. Combined with elevated labor costs, this is raising the cost floor for nearly every project in San Diego.
✅ Key Takeaways
- Tariff-driven material inflation is adding 15–30% to many imported goods
- Labor costs are still climbing and showing no signs of easing
- Custom home pricing now exceeds $660/sq ft
- Builders are adjusting scope, buyers are shifting toward turnkey
- The market isn’t slowing—it’s reshaping under cost pressure
Planning to build, renovate, or buy in 2025?
Let’s review real-time pricing, availability, and risk factors before you lock in a direction. Our team stays connected with local builders, suppliers, and trends—so you don’t get surprised halfway through a project.
📩 Email or message us to compare real numbers—not just headlines.
Heather Wendlandt
Broker Associate
📧 heather@teamkolker.com
