Home Depot, Lowe’s rival files Chapter 11 bankruptcy

Although a moving target, President Donald Trump’s tariffs have increased the cost of building homes.

“The new tariffs could increase builder costs by $7,500 to $10,000 per home,” said Rob Dietz, chief economist for the National Association of Home Builders. CNBCHe cites estimates from U.S. homebuilders. Last year, NAHB estimated that every $1,000 increase in the median price of a new home would leave about 106,000 potential buyers behind.

The biggest impact so far has been felt in lumber prices, which are “expected to average around $4,900 per home, according to Leading Builders of America, the trade group that represents most of the nation’s publicly traded home builders,” the website said.

While the United States produces some lumber, about one-third of the wood purchased for home construction comes from Canada. Domestic lumber producers often increase their prices to match import prices.

Steve Martinez, President of Tradewinds General Contracting in Boise, Idaho, shared with NAHB that rising lumber prices are hurting the entire homebuilding industry, and a lack of certainty adds complexity to the homebuilding process.

“All of our contracts are fixed-price, meaning prices can vary greatly from the time we bid on a project to the time we order materials,” Martinez said. “But we are trying to pre-order as many items as possible.”

Although rising and volatile prices affect big players like Home Depot, they are better at mitigating and anticipating that impact than smaller retailers.

North American Builder’s Supply, a Home Depot and Lowe’s competitor based in Illinois, has filed Chapter 11 Bankruptcy protection.

According to data shared by RK Consultants on this date, the company remains open and plans to reorganize and continue its operations. x, old Twitter.

“North American Builders Supply, Inc., a Yorkville, Illinois-based building materials supplier, filed for Chapter 11 protection in the Northern District of Illinois on December 3, 2025. The company reported between $500,001 and $1 million in both estimated assets and liabilities,” according to the consulting firm.

In the application, the largest unsecured receivables include numerous commercial creditors and lines of credit. Major unsecured creditors include Bluetape, Inc. ($503,219), Kapitus Servicing, Inc. ($149,596) and an unsecured portion of the claim from the Federal Reserve Bank of Illinois ($94,131).

• North American Builders Supply reportedly filed for bankruptcy protection – filing for Chapter 11 December 3, 2025.
  Source: RK Consultants

• The filing appears to be motivated by financial distress, including claims and litigation by creditor Proventure Capital LLC.
  Source: Cage Law

• The legal complaint shows Proventure Capital alleging unpaid obligations by North American Builders Supply (and/or one of its officers), indicating that the bankruptcy involves creditor pressure and litigation.
  Source: Cage Law

• Since bankruptcy protection is Chapter 11, the company may attempt to reorganize (at least initially) rather than outright liquidation.
  Sources: RK Advisors, Pacer Monitor

The bankruptcy was also reported by Daily Distressed Asset Central, which listed case number 25-18572 in the Northern Bankruptcy Court of Illinois. This report indicates that filing Chapter 11 is voluntary.

Major home improvement and builder supply chain They have more ability to ease tariffs than their smaller rivals.

Inside Home Depot third quarter earnings call Executive Vice President of Commercial Sales William Bastek commented on the tariffs.

“Over 50% of our inventory is not part of the tariffs and is obviously sourced domestically. So we’ll continue to monitor that and look forward to Q4,” he said.

Related: Popular mall retailer continues turnaround after closing stores

In some cases, Home Depot can mitigate tariff-induced price increases by not offering as many discounts.

“If you think about our business, which is to help impact some of the tariff pressure, it was the nature of our business in the second quarter to promote a little bit less in a few of those garden areas. And again, 4 of the 5 categories where we saw impact were related to some of the lower-priced garden projects.” second quarter earnings call.

Lowe’s CFO Brandon Sink talked about how tariffs are affecting his company’s inventory.

“Inventory finished Q3 at $17.2 billion, down approximately $400 million from the prior year. This net decrease also reflects the inclusion of approximately $600 million of recently purchased inventory and higher tariffs.” Lowe’s third quarter earnings release.

He noted that this is an ongoing moving target issue that the company is monitoring.

“We continue to look at tariffs, the increases in Q3, we expect it to continue to increase in Q4 and the wrap to impact the first half of the year. So we’re trying to manage that and understand how that affects both the sales margin and the sales margin.” operating margin “We are moving forward,” he added.

“Canadian lumber was up 14.5%. Concrete prices were up 8%. Appliances were expected to rise as much as 20%. Suddenly the question was not how to build cost-effectively, but whether starter homes could be built profitably.” Cotality/CoreLogic shared.

“But without new housing supply, existing home prices will continue to rise, pushing affordability even further out of reach.”

Since someone is currently building a new home in Florida, there is risk for both the builder and the buyer. When you sign a contract to build a new home, you lock in the price.

If material costs go down, the builder makes more money and you pay more. If they rise, the builder risks losing money; This means that in volatile times builders often add extra margin, increasing costs for home buyers.

“The average cost of new construction in the U.S. is currently $422,000. Adding potential material cost increases from tariffs would add between $17,000 and $22,000 to that price tag,” Cotality data shows.

Related: Lowe’s announces free offer to customers amid challenges

This story was first published by . Street First appeared on December 4, 2025 Retail section. Add TheStreet at: Preferred Source by clicking here.