The National Association of Homebuilders (NAHB) has responded to President Trump’s 25 per cent tariff threat on Canadian and Mexican building materials in a letter denouncing the move and urging the government to reconsider.
According to Carl Harris, NAHB Chairman, slapping additional tariffs on lumber and other essential building materials will increase the cost of construction and discourage new development; meanwhile, consumers will ultimately pay for the tariffs in the form of higher home prices.
“Our country is facing a severe housing shortage and affordability crisis, which you recognized on your first day in office by issuing an executive order that seeks to increase housing supply and affordability,” the group wrote in a letter to President Trump. “Bringing down the cost of housing will require a coordinated effort to remove obstacles to construction, be they regulatory, labor or supply-chain related. The National Association of Home Builders (NAHB) stands ready to work with you to accomplish these goals. However, we have serious concerns that proposed 25 proposed tariffs on Canada and Mexico will have the opposite effect, by slowing down the domestic residential construction industry.”
Since 2018, Trump’s tariffs on Canadian softwood lumber have increased costs for U.S. homebuilders significantly, adding about $9,000 to the price of a single-family home. Year-over-year, the costs have steadily increased.
“Our sector relies heavily on a diverse and cost-efficient supply chain for building materials such as lumber, steel, gypsum and aluminum,” the group wrote. “While home building is inherently domestic, builders rely on components produced abroad, with Canada and Mexico representing nearly 25 per cent of building material imports. Imposing additional tariffs on these imports will lead to higher material costs, which will ultimately be passed on to home buyers in the form of increased housing prices. Further supply chain disruptions from increased tariffs coupled with increased demand for materials could also hinder rebuilding efforts in areas affected by natural disasters, which you have pledged to help rebuild as quickly as possible.”