Bermuda’s building industry has braced itself for price hikes in the new year, largely because of tariffs in the United States.

“Consumers should expect price increases across the board in 2026,” said Sacha Bearden, chief executive of the home improvement and hardware store Baptiste.

In September and October, US president Donald Trump announced and implemented tariffs on imported lumber and wood products, primarily affecting Canadian softwood lumber.

A 25 per cent tariff was placed on imported kitchen cabinets and vanities, rising to 50 per cent on January 1, and a 25 per cent tariff on upholstered wooden furniture will go up to 30 per cent unless new trade agreements are reached. It follows earlier tariffs of 50 per cent placed on imported steel and aluminium.

Ms Bearden said: “It will not just be for lumber, but for all manufactured goods such as windows and doors, bathroom fixtures, kitchens, tile and flooring.”

She said commodity pricing for items such as pipe, wire and rebar have been steadily increasing for a while.

“Most cabinetry is manufactured in Asia, so tariffs are already affecting cabinetry prices and furniture,” she said.

Ms Bearden explained that European-made tile and counter material has also increased in price, owing to rising ocean freight costs and the strength of the euro.

The price situation has shifted so rapidly in the past year that quotes are now valid only for 30 days at Baptiste.

The executive said that labour, not building materials, is the most expensive part of construction.

“With the real estate market being hot and multiple big projects on the go, the squeeze on labour will raise labour prices,” she predicted. “It is definitely a good time to be a contractor, tradesman or real estate agent.”

Shawn Grant, vice-president of merchandising and retail at Masters Home Centre, was expecting a 20 per cent price hike on some items concerning do-it-yourself projects.

In the past year, many overseas suppliers absorbed the extra costs for local retailers, honouring price quotes in place before the tariffs were enacted.

Mr Grant thought the situation could change next year when those agreements expire.

One manager in the kitchen cabinet industry, who did not wish to be named, said their cabinets would not be affected by the price hikes because they bypassed the United States and bought their products directly from Canada.

He said that in the US most cabinets are made up of parts from different countries such as wood from Canada and hinges from Germany.

“That does start to add up,” he said.

Mr Grant, at Masters, said they would not know the full extent of cost increases until January.

“The tariffs are a concern for most retailers on the island,” he said. “Things are going to get really interesting.”

Alex DeCouto, president of the construction management firm Greymane, told The Royal Gazette he did not have a consistent line coming from vendors on the impact of Trump’s tariffs.

He said Bermuda can sometimes bypass the tariffs by importing them from outside the US, then bring them through the country via bonded shipping.

“Measuring the systemic impact of the tariffs on goods that are manufactured or assembled in the US is much more difficult,” Mr DeCouto said. “If we export lumber from Asia, for instance, we are not going to be exposed to American tariffs.”

However, he said, if you buy an American tool brand from a US supplier with a supply chain exposed to tariffs, you will not see a price increase listed as “due to tariff on the invoice”.

“It will be buried in the costs,” he said.