Despite high mortgage rates, whiplash tariffs news with accompanying stock market gyrations, Tri-Cities new home sales increased 8% during the first quarter of this year. And prices are creeping up.

 The Q1 median price of $355,000 is up 7% from the first three months of last year. March’s median price of $353,693 is up 5% from last year.

Overall inventory continues to lag where it was last year. It’s down a little more 40% as it has been the first of the year. A check of listings in mid-April found 234 new home listings. Last year there were 448. At the current sales pace, that’s a little over three months’ inventory – a comfortable level for builders.

Although builders are nervous about the current threatened tariff climate, they pulled 33% more new home building during the first quarter than last year. So far this year, builders have pulled 410 single-family permits in the region’s two metro areas.

D.R. Horton, the region’s and nation’s largest builder, accounts for most of the local permit pulls so far this year. Barak Saltzman, the firm’s division president in East Tennessee, said the firm is “actually on pace for a monthly record of sales in April. We are using buy-downs mainly in our townhome communities.”

He also said the firms’ NE Tenn. net orders are about even with last year. We will close on roughly the same number of homes as last year, he added.

Saltzman said he has not been informed of any material tariffs increases so far.

According to Builder Magazine, the lack of incremental tariffs on Canada and Mexico is a relief for the building and lumber industries. Canada accounts for 85% of all the US softwood lumber imports.

The magazine’s tariff update also points out 7.3% of all goods that went into new home construction last year were imported. Mexico accounts for a significant share of the gypsum, concrete, and appliance imports.

The reciprocal tariffs announced earlier this month will cost 7% to 14% higher this year. Windows, door components, furniture, and applicants will take the biggest hit.

According to the National Association of Home Builders, expect reduced building materials and availability in the long-run following short-term price volatility. Tariffs will also probably affect the building material supply chain, which will put more upward pressure on prices.