The construction environment is concerned about the increase in costs due to prices

While a tariff storm has been breaking from the south of the border earlier this year, many Canadian industries, such as that of residential construction, feared its potential repercussions.

If the players in the middle are aware of the need to quickly increase the supply of housing to reduce the impacts of the housing crisis in Canada, the general prices and the more targeted taxes on materials now represent additional obstacles to be overcome.

This includes the potential need to slow down the construction rate, given the upheaval of supply chains and the increase in the price of important materials.

This possibility is already being realized, according to Cheryl Shindrukexecutive vice-president of Geranium Homesa residential promoter in southern Ontario.

It is difficult to determine precisely the impact on costs, but we can certainly say that there is an impact on business confidence and […] On the availability of materials at the right time.

About six months after the president’s return Donald Trump At the White House, many players in the sector argue that unpredictability persists in terms of the cost of supplying the materials they need.

The latter also forced Geranium to quickly adapt the supply chains on which it has been based for a long time.

Save costs

Mme Show Indicates that the company is now more and more supplied with materials manufactured in Canada, such as brick and stone, and that it doubles its consumption of products imported from other countries than the United States. This includes steel, which she buys in particular in South Korea, Portugal and China in order to avoid the surcharges imposed by the customs of customs of Mr. Trump.

However, the company has specified that certain materials simply cannot be reproduced on the national or international market. For example, a component of layers in layers used by Geranium continues to come from the United States due to patent problems. The company has decided to assume additional costs.

It is not as if one could press a button so that, suddenly, these important materials which come from the United States could now be produced in Canadasaid Ms. Show. When it is not realistic, articles continue to come from the United States and we pay customs duties.

Among the hardest products affected by the trade war, Kevin LeeDirector of the Canadian Housing Manufacturers Association, appoints, among other things, household appliances, interior doors and carpets.

In some cases, manufacturers have sought replacement solutions to their usual materials. This can for example be to offer a vinyl floor where they would have generally opted for carpet, he explained.

Others show creativity by storing materials to avoid possible shortages.

They take advantage of the possibility of acquiring materials for later, which increases the general costs, because they must keep them instead of obtaining them at the right timeexplained Ms. Show.

Faced with the first concerns about the effects of trade war, Altree Developmentsinstalled in the Grand Toronto, predicted a decrease of 3 % to 5 % of its overall budget, according to its president, Zev Mandelbaum.

This figure has since decreased due to the increased availability of Canadian materials, said Mandelbaum, adding that the customs of customs duties – of the recent threat of additional taxes to the hope that the negotiations will soon lead to a new trade agreement – have made any planning impossible.

He reported that his business had suffered a much greater impact on his income in the past six months, the economic uncertainty that has dropped the buyers’ request.

It is especially the fear of economic instability in Canada that has slowed down the purchase of houses and dissuaded people from investing, whether Canadian or foreigners residents wishing to invest in the countryhe explained. This alienation led to a drop in our sales and, therefore, even higher pressure on construction costs.

Important economic slowdown

In its annual forecasts on the housing market, published in February, the Canadian Mortgage and Housing Company (SCHL) provided that a trade war between Canada and the United States, combined with other factors, such as the reduction of immigration targets, would probably slow the economy and limit real estate activity.

The national organization responsible for housing had also indicated that Canada expected a slowdown in construction in the next three years – even if they remain greater than the ten -year average – due to the drop in condominium construction, the decline in the interest of investors and the decline in the demand of young families.

In June, the annual cumulation of start -ups amounted to 114,411 in regions of 10,000 or more inhabitants, up 4 % compared to the first half of 2024.

Despite this increase in new constructions, a regional analysis shows that the provinces whose sectors of activity are more exposed to customs duties are slowdown, Mathieu Laberge, chief economist at the Lock. He noted that the start-ups in Ontario have dropped by around 26 % since the start of the year, while in British Columbia, the decline was 8 %.

In Ontario, five of the ten cities most affected by customs duties also registered an increase in arrears of mortgage payment in the spring. Laberge said that the trade war or related macroeconomic factors have probably led to layoffs in these regions, preventing people from paying their mortgage.

He said he expects that it may result in a drop in the number of houses built.

It is a slow phenomenon to spread, but it is real. We note, even if it may not yet be in the starts or the resalesargued Mr. Laberge.

M. Lee said the sector already feels the effects.

The big problem currently is that we simply do not get the type of start -up we need, and the sector is very concerned nowhe added.

Before the establishment of customs duties, certain regions, such as Atlantic Canada and the meadows, had started to see the start -ups rebounding after a national lull fed by interest rates previously high. Other provinces, such as Ontario and British Columbia-where houses remain the most expensive-had not yet reached similar levels of new construction.

What happened is that the trade war has aggravated the situation in Ontario and British Columbia, and we see a slight slowdown in Atlantic Canada and in the meadowsexplained Mr. Lee. There is therefore a moderating effect everywhere.

The survey of the Canadian association of housing manufacturers with its members in the second quarter revealed that 87 % of manufacturers said they were concerned about the health of their business in the next 12 months.

About 35 % said they had recently had to dismiss workers and not intend to rehire them, compared to 21 % a year ago.

The situation becomes very serioussupported Mr. Lee. Above all, there is a lot of concern on the market.