Tariffs May Finally Drive a Shift to the Secondary Market for Building Materials

For over two decades, advocates of “deconstruction” and material reuse have touted the environmental and economic benefits of salvaging building components. Yet the secondary market for used building materials and furnishings has remained stubbornly underdeveloped, with low demand and low value relative to new goods. Today, however, a new factor is emerging that could tip the scales: escalating U.S. tariffs on a wide range of imported goods. As trade barriers drive up the cost of new building materials, appliances, and household items, the enormous price gap between new and used goods presents a timely opportunity to finally make reuse mainstream. But seizing this moment will require overcoming long-standing supply chain challenges through unprecedented coordination between nonprofits and for-profit firms.

Tariffs Are Driving Up the Cost of New Materials

American consumers and builders are already feeling the impact of recent tariff policies. Steep duties on imports from major trading partners are raising the prices of key construction inputs – costs that ultimately get passed to buyers. For example, tariffs on Canadian lumber, Chinese goods, and other imports are projected to add $7,500 to $10,000 to the cost of building a single-family home in the U.S., according to the National Association of Home Builders . Lumber prices spiked in anticipation of these tariffs, with futures hitting their highest levels in over two years. Likewise, one New York building supplier reported that a 25% tariff on a remaining $75,000 shipment of Canadian doors and frames would add $19,000 in cost (about $30,000 after markup) to a project, an overrun ultimately borne by the customer .

The tariff hikes are broad-based. As of early 2025, the U.S. government has implemented or announced tariffs of 20–25% on imports from China, Canada, and Mexico across many categories, including building materials . Duties of 25% on all imported steel and aluminum are now in effect, with proposals to similarly tariff imported lumber and copper . Analysts estimate that if all proposed measures take hold, the average U.S. trade-weighted tariff rate could reach 12% by mid-2025 (up from roughly 3% in recent years) . In short, new materials and goods are becoming significantly more expensive due to protectionist trade

policies – a cost shock that is reverberating through the construction and home improvement sectors.

Builders have few places to turn. They can attempt to source domestically, but domestic manufacturers often raise their prices as well under the shelter of the tariff wall . Some contractors stockpiled materials in advance, yet that is only a temporary fix . Ultimately, rising material costs are forcing builders, renovators, and consumers to consider alternative strategies. One such strategy is to shift procurement from new to used materials. If brand-new lumber, steel hardware, or light fixtures carry an extra 25% cost due to tariffs, the monetary incentive to seek out secondhand equivalents grows stronger.

Used Materials Sell for a Fraction of New – A Huge Value Gap

Even before the latest tariffs, used building materials, furnishings, and appliances have typically sold for a mere fraction of the price of new products. Nonprofit reuse centers like Habitat for Humanity’s ReStores are known to price items anywhere from 50% to 90% below retail value, depending on condition . In other words, a door, cabinet, or lighting fixture that might cost $1,000 new can often be bought gently-used for only $100–$500. These deep discounts exist because secondhand materials historically hold significantly lower perceived value compared to new.

That wide price differential is now incredibly salient. With tariffs pushing new prices even higher, the savings from choosing used goods are greater than ever. For example, if a set of new imported kitchen appliances would cost $10,000 (and climbing) under the latest tariffs, a comparable used set might be found for $5,000 or less – representing thousands of dollars saved. A new home deck built with tariffed lumber could blow the budget, whereas sourcing reclaimed lumber or recycled composite boards at half the cost could make the project feasible. This “value gap” between new and used goods is essentially an economic opportunity waiting to be tapped. The significant cost advantage of secondary market materials can appeal not only to frugal homeowners and DIY enthusiasts, but also to corporations and developers looking to contain construction costs in an inflationary environment.

Crucially, the benefits are not only for buyers. If demand for used materials rises, resale values for salvaged goods will rise as well, narrowing the gap with new. Such an uptick would directly benefit those who supply used materials. Donors who give salvaged building components to charity (in exchange for tax deductions) would see higher appraised fair market values for their contributions, increasing their write-offs. And any businesses engaged in refurbishing or trading used materials could see better profit margins. In short, the current price imbalance – used goods at half the cost or less of new – represents a win-win arbitrage: buyers save money, and the secondary market has room to capture more value while remaining cheaper than new by a wide margin.

The Secondary Market’s Supply Problem: Inconsistent and Fragmented

If buying used is such a bargain, why hasn’t the secondary market for building materials boomed before? The simple answer is that bargain prices alone have not been enough to overcome major supply-side and perceptual barriers. The market for reused building components is highly fragmented, often unreliable, and perceived as the “wild west” compared to the efficient, on-demand availability of new products.

The lack of a dependable supply chain is perhaps the biggest issue. Salvaged materials tend to be available sporadically and in one-off batches, making it hard for buyers to count on them for projects with specific requirements. A homeowner might luck into the perfect vintage door at a salvage yard – but finding 10 matching doors with the same dimensions and style for a larger development is a far greater challenge. A contractor building an addition may seek reclaimed lumber for sustainability reasons, only to find that no single source can supply the volume of consistent-grade 2x4s needed on the timeline required. This inconsistency forces many well-intentioned buyers to fall back on new materials simply for predictability’s sake. As one industry analysis noted, the “sporadic and siloed availability” of salvaged materials makes it difficult for buyers to rely on them for large-scale projects or ongoing needs. In short, volume and consistency are lacking.

Other long-standing issues compound the supply problem. There is often no standard grading or certification for used materials, so builders are wary of quality and code compliance. Some contractors still perceive salvaged goods as “less reliable” or of lower prestige than new, dampening demand. The logistics of transporting and storing bulky used items can be complex and costly. And many potential buyers – both professionals and consumers – are not even fully aware of what’s available in the secondary market, since marketing for salvaged goods is minimal compared to the advertising blitz for new products.

Perhaps most importantly, rock-bottom pricing of used materials has itself been a double-edged sword. Yes, cheap prices attract thrifty buyers, but they also mean that running a salvage operation is a thin-margin (or non-profit) endeavor. As I have observed in my work, the pricing of salvaged materials is often so low that it fails to sustain profitable operations or attract serious investment in scaling up. This has left the field to small charitable organizations and niche dealers, without the capital to build a truly robust, reliable marketplace. The result: even as millions of tons of reusable materials are discarded in demolitions each year, the reuse market remains a patchwork of small players, unable to consistently meet the needs of large buyers.

Every year, the U.S. generates hundreds of millions of tons of construction and demolition debris – about 600 million tons in 2018 alone . Much of this material is reusable lumber,

10. https://www.epa.gov/facts-and-figures-about-materials-waste-and-recycling/construction-and-demolition-debris-material#:~:text=Construction%20and%20Demolition%20Debris%3A%20Material,the%20amount%20of%20generated%20MSW

fixtures, and hardware from deconstructed buildings like the one shown. However, inconsistent supply chains and a lack of coordination have prevented most of it from reaching the market as used product.

The current state of affairs is one of unrealized potential. There is plenty of supply in theory – salvage yards, ReStores, and demolition sites brimming with items – and clearly there is latent demand for affordable materials, especially as new prices climb. But they are not connecting effectively. To truly unlock the secondary market opportunity, the supply side problems must be addressed head-on. It will require treating used materials as a product stream that can be systematically collected, processed, and distributed – not just a charitable afterthought.

The Donation Dilemma: A Bottleneck in Distribution

One paradoxical challenge in the secondary market is that too much of the supply funnels into channels that are not equipped to distribute it efficiently. In the U.S., the dominant pathway for salvaged building materials and home goods is donation to nonprofit organizations. Property owners, contractors, and retailers often choose to donate surplus materials to charities (like Habitat for Humanity, local reuse nonprofits, or nonprofit building salvage retailers) because of the financial incentive of a tax deduction. The IRS allows taxpayers to deduct the fair market value of donated building materials as a charitable contribution, which can be more financially attractive than trying to sell used items for cash. For many remodelers, it is simpler: call a nonprofit to haul away the old cabinets and get a receipt for tax season, rather than navigating a private sale.

While this donation-driven model has mobilized a steady stream of used goods, it has also created a distribution bottleneck. Nonprofit organizations often lack the logistical capacity, scale, or profit motive to swiftly move large volumes of materials. Habitat for Humanity operates nearly 900 ReStore retail outlets nationwide , each reselling donated furniture, appliances, and building supplies at steep discounts to the local community . These stores do tremendous good, funding charitable programs and diverting waste. However, they function mostly as independent local hubs. A donated kitchen sink might sit in a backroom until a walk-in customer happens to need a sink. A deconstructed house worth of lumber may be dispersed across several charity warehouses, never consolidating to a volume that a builder would require. There is little inter-connectivity and coordination across these donation centers – no unified inventory system ensuring that if one ReStore has excess tile and another has a shortage, the tiles move to where they’re needed. Nonprofits also face budget constraints that make it hard to invest in large-scale warehousing, trucking between cities, or e-commerce platforms to reach wider buyers.

Moreover, the charitable mission prioritizes moving goods at low prices to those in need, not maximizing profit or market reach. This mission is noble, but it can mean that materials move slowly or inefficiently. Often, high-value items are sold for pennies on the dollar

locally because shipping them to a higher-paying market is beyond the nonprofit is scope. And if donated items don’t sell after some time, the charity may have to discard them to free up space – an unfortunate outcome that defeats the reuse purpose. In essence, the donation-centric system, while well-intentioned, has resulted in a glut of salvaged materials with a limited outlet. The supply is there, but trapped in silos.

To break this logjam, we must recognize that charities need help from the private sector to scale up distribution. The current model pits “donate for a tax break” against “sell for a small profit,” and most individuals and companies understandably choose the former. Rather than fighting that, the solution is to combine the strengths of nonprofits (their intake of material and donor incentives) with the strengths of for-profit enterprises (logistics, marketing, and capital investment). By forming partnerships, the two can complement each other to build an efficient secondary supply chain that no single player could achieve alone.

Partnering Nonprofits and Industry to Build an Integrated Supply Chain

To truly capitalize on the surge of interest in secondhand materials, the secondary market must evolve from a loose patchwork into a coordinated supply network. This means forging partnerships between the nonprofits that collect donated goods and for-profit companies specializing in logistics and resale. Each side brings something vital to the table. Nonprofits provide a steady supply of material, fed by donations and deconstruction projects, and they confer the tax deduction benefit that motivates many donors to give. For-profit firms can provide the infrastructure and efficiency to get those materials quickly into the hands of paying customers at scale.

What might such a partnership look like in practice? We can take inspiration from existing models in other sectors. Consider Good360, a nonprofit that operates a nationwide distribution network for donated corporate goods. Good360 works with hundreds of companies to take in excess inventory and then distributes those products to over 100,000 nonprofit members, handling the warehousing, shipping, and matchmaking between donors and recipients . This kind of large-scale, technology-enabled logistics operation ensures that donated items (from mattresses to clothing) quickly reach the organizations and areas that can use them, rather than languishing in a single location.

In the building materials arena, we could envision a similar hub-and-spoke system: local charities continue to receive doors, windows, cabinets, and hardware from donors in their area, but instead of each store acting alone, the inventory data is shared regionally or nationally. Private-sector logistics partners could then consolidate materials from many donation points, sort and grade them, and redistribute them to where demand exists – whether that’s another city’s resale outlet or an online marketplace for used building components.

13. Closing the Need Gap - Good360

Such collaboration could take many forms. For instance, a Habitat ReStore could partner with a for-profit architectural salvage e-commerce company: the ReStore supplies the goods and gets a share of revenue, while the company lists the items online to reach a wider customer base and arranges shipping. Or a network of nonprofits might jointly invest (with support from private capital) in a centralized distribution center that regularly trucks high-demand materials (lumber, flooring, fixtures) between cities, balancing supply and demand.

The key is creating an interconnected supply chain, rather than isolated pockets of inventory. If successful, this approach would ensure that when a large corporate buyer or a government project wants to source, say, 20,000 square feet of reclaimed flooring, the secondary market can actually fulfill that order by pooling resources across multiple contributors.

Collaboration between charitable and commercial entities can sometimes be challenging, but the payoff is substantial. Here are a few of the benefits an integrated secondary-market supply chain could deliver:

Greater Volume and Variety: By aggregating inventory from many sources, the secondary market could achieve the volume and consistency that big buyers require. Instead of a dozen doors here and a stack of lumber there, a unified network can offer bulk quantities of matching items (e.g. a hundred identical doors salvaged from an office tower renovation, or pallets of reclaimed bricks from a factory teardown). This attracts larger customers and projects that previously couldn’t rely on used materials.
Speed and Efficiency: With professional logistics management, materials can move faster from donor to end-user. Currently, weeks or months may pass before a donated item finds a buyer; a coordinated system can cut that dramatically by routing goods to active demand. Faster turnover means lower holding costs and fresher inventory, which benefits all parties.
Reliability and Quality Control: Partnerships could implement standard grading, testing, and certification processes for used materials. For example, lumber could be graded for structural use, electrical fixtures tested for safety, and hardware sorted into complete sets. This addresses quality concerns and builds trust with builders and consumers. Knowing that a used product comes through a reputable network with quality checks will raise confidence in secondary goods.
Market Reach and Awareness: A large-scale network can afford marketing and outreach that small nonprofits cannot. Imagine a professional online platform that showcases available used building materials nationwide, with search tools, specifications, and delivery options. Increased visibility will make builders more aware of the secondary market’s offerings, bringing new buyers into the fold. Major retailers might even partner to sell certified used sections in their stores, if supply becomes steady enough.
Data and Feedback Loop: With collaboration, data on what sells (and what doesn’t) can be collected to inform the supply chain. This could guide deconstruction efforts towards items in high demand and signal to donors what materials fetch value. Such market intelligence helps optimize the reuse ecosystem over time.

Raising Consumer Confidence – and Prices – Through Coordination

If we can achieve a more dependable supply of secondary materials, the perception of used goods will change. Builders and consumers will grow confident that they can plan projects around reclaimed materials without compromising on timeline or quality. This confidence is critical, because it unlocks the next stage of market development: buyers willing to pay a bit more for used, and sellers able to charge a bit more, as the service and reliability improve. Even with modestly higher prices, secondhand goods will remain a bargain relative to tariff-burdened new products, so both sides stand to gain.

Indeed, as the secondary market scales up, the value of salvaged materials is expected to rise naturally. We have already noted that used items often sell at 50% or less of new prices. With better distribution and higher demand, perhaps they will command 60% or 70% of new value in some cases. This is still significantly cheaper for buyers than paying 100% (plus inflation and tariffs) for new – but it can make a world of difference for the economics of reuse. Higher price points for used goods, supported by better service, mean viable revenue for all links in the supply chain. Nonprofits could earn more from their inventory (funneling proceeds into their missions), for-profit partners could attain sustainable margins, and donors would get even larger tax deductions as fair market values climb. In essence, treating salvaged materials as a competitive product line rather than a charitable afterthought can “raise the bar” for the whole industry.

It is worth emphasizing that none of this implies abandoning the ethical and environmental advantages of reuse – quite the opposite. A robust secondary market driven by economic incentives will naturally achieve the sustainability goals that sparked the deconstruction movement in the first place. More reuse means less waste in landfills, more energy savings from avoided manufacturing, and fewer new resources extracted. It also can create new jobs in material handling, refurbishing, and retailing used goods. The beauty of the current moment is that economic self-interest (cost savings amid tariffs) aligns with environmental interest (waste reduction and circular economy). By building consumer confidence in reused products through reliability and availability, we enable environmental benefits to scale as a byproduct of market activity.

Conclusion: Turning a Cost Crisis into a Reuse Revolution

The rising tide of tariffs and trade barriers confronting the U.S. economy is, undeniably, creating pain for those accustomed to cheap imported goods. But it may also be the catalyst needed to reinvent how we source building materials, furnishings, and household goods. Faced with unprecedented price differentials, individuals and companies are more willing to give secondary markets a serious look. This is the opening we have been waiting for to bring reuse into the mainstream – provided we address the long-standing kinks in the system.

What I have outlined is a path to finally building a thriving, functional marketplace for reused building materials at scale. It will take coordination, investment, and a mindset shift. Nonprofits, which have heroically shouldered the burden of diverting reusable materials from the waste stream, must be empowered and linked together by efficient distribution networks. For-profit enterprises must see the profit potential in volume and step up to provide the professionalism and infrastructure the market needs. Policymakers could even encourage such partnerships, seeing that a stronger reuse market enhances resilience against supply shocks and trade disruptions.

The opportunity before us is to transform a challenge into an opportunity. Tariffs were meant to boost domestic industries; in a roundabout way, they can boost the most sustainable domestic industry of all – the one that takes our existing assets and puts them back to work. With new partnerships bridging the gap between donated supply and market demand, we can deliver used goods to consumers and builders in a way that is cheap, convenient, and reliable. And as the secondary market becomes truly competitive, it will no longer be viewed as a niche or gamble, but as a normal option in procurement.

In my experience as a CPA and appraiser working in this arena, I have seen the pieces of this puzzle waiting to come together. The value is there, the supply is there, and now the economic incentive is there. It is time to connect the dots. By embracing collaboration and treating salvaged materials as serious business, we can usher in a new era where using secondhand building materials is not just an eco-friendly choice, but a savvy financial decision embraced widely across the country. The tariffs may be raising the cost of new goods, but with ingenuity, they can also raise up an entire secondary industry – turning today’s cost crunch into tomorrow’s sustainable opportunity.

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Tariffs May Finally Drive a Shift to the Secondary Market for Building Materials.

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