CNN
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President Donald Trump’s tariffs could have an unintended side effect: making homeownership even less affordable for many Americans.
A new report from the Canadian Chamber of Commerce estimates that the average cost of building a US home could rise by an additional $14,000 by the end of 2027 if tariffs on Canadian imports remain in place, even as many experts estimate that America needs millions more affordable homes.
In 2023 alone, Canada accounted for 69% of US lumber imports, 25% of imported iron and steel and 18% of copper imports, all key construction materials, the report said.
In a statement, the White House pushed back on the assertion that tariffs would increase costs for Americans.
“The Administration has consistently maintained that the cost of tariffs will not be borne by American consumers, but by foreign exporters who rely on access to the American economy, the world’s biggest and best consumer market,” White House spokesperson Kush Desai said. “A new CEA (Council of Economic Advisors) analysis proves just that: prices of imported goods have actually fallen this year despite President Trump’s historic tariffs.”
Canada is the third-largest source of imports used in US home construction, behind China and Mexico, according to the National Association of Home Builders, a US-based trade group. Though the Canadian Chamber of Commerce report doesn’t estimate the impact of duties on imports from China or Mexico, it underscores that Trump’s tariff policy, intended to support American industry, may instead worsen housing affordability at a time when home prices hover near record highs and mortgage rates remain stubbornly elevated.
Taking into account tariffs first imposed during Trump’s first term, the total added cost from tariffs could reach $20,000 per home by 2027, the Canadian Chamber of Commerce found.
Trade tensions between the US and Canada have lately reached a fever pitch, with some Canadians threatening to boycott US-made goods and others selling their stateside vacation homes.
Trump has announced new tariffs on Canada since taking office in January, including additional tariffs on imported Canadian softwood lumber, a key component used in the framing and remodeling of homes.
Nearly $13 billion — or roughly 7% — of the estimated $184 billion of goods that went into new single-family and multifamily construction in 2023 were imported, according to the NAHB.
Lumber made up the majority of those imports at $8.5 billion, the NAHB said — and 70% of lumber imported specifically for US home construction came from Canada.
Trump has changed the tariff rate he plans to impose on Canadian imports several times since taking office. Most recently, Trump announced plans to impose a 35% tariff on Canadian goods that are not compliant with the US-Mexico-Canada Agreement (USMCA) starting August 1.
Trump has also imposed a 50% tax on all imported steel and aluminum and has threatened a 50% tariff on all copper imports.
Those tariff announcements have already hit the construction industry. According to an NAHB survey from April, 60% of home builders were already seeing tariff-related price increases.
However, not all home builders use imported materials, NAHB’s chief economist, Rob Dietz, told CNN.
“It’s important to note that about 40% of the builders in our survey noted no cost effect,” he added.
The Canadian Chamber of Commerce’s report highlighted Texas, Florida and California as states that would likely feel price shocks most acutely, due to being heavily reliant on imported construction goods.
Still, Dietz said many home builders have indicated that they’re having difficulty pricing construction projects accurately due to tariff uncertainty.
