Buying a home in America could get harder.
Homebuilder PulteGroup (PHM) warned on its post-earnings conference call that rising tariff costs will pressure home prices, affecting every price point in their markets.
“We’re in the range of $5,000 on average, and it will impact every single price point and consumer group that we serve. There might be a few minor nuances, but it’s pretty broad across the spectrum,” PulteGroup CEO Ryan Marshall told investors and analysts on the company’s first quarter earnings call Tuesday morning.
The warning comes as PHM reported adjusted earnings per share of $2.57 for the first quarter, which surpassed the average analyst estimate of $2.43. PHM stock rose 6% in early trade on Tuesday following the results.
Despite the earnings beat, the homebuilder faced challenges in sales. PulteGroup reported a 7.3% year-over-year decline in net new orders for its fiscal first quarter ending March 31, totaling 7,765 homes, falling short of analyst estimates for 8,166. Home closings also fell 7.2% year over year to 6,583, missing the analysts’ forecast of 6,595 homes.
Executives estimate that rising tariffs will increase costs by about 1% in the back half of the fourth quarter, driven by key categories such as plumbing, water heaters, porcelain, HVAC parts from China, tile flooring affected by a global 10% tariff, and electrical components like circuit breakers and load centers.
“The world needs to be prepared for some disruptions as a result of things that are going on, tariff-induced,” Marshall added.