FREE: Impact of US-Canada Tariff Negotiations on Builders and General Contractors (GCs) in the Canadian Housing Market

Presented by Quickly with special guest Bōde

ICBA is excited to host this in-depth discussion on how ongoing U.S.-Canada tariff negotiations are reshaping the Canadian construction industry. This session will explore the potential impact of tariffs on material costs, housing affordability, and construction projects, while highlighting innovative strategies and solutions to navigate these challenges effectively.

Overview:
The ongoing US-Canada tariff negotiations present significant challenges for the Canadian housing market, particularly for builders and general contractors (GCs). The impact of potential tariffs on key building materials—such as softwood lumber, steel, and aluminum—could raise costs by as much as 30%. This uncertainty continues to affect both new construction and resale home markets, exacerbating affordability concerns.

Key Findings:

1.      Impact on Home Prices:

• Tariffs could increase the cost of both new homes and renovations. The estimated rise in new home prices could be between 2.5% and 6.3%, depending on whether Canada retaliates with matching tariffs.
• Resale home prices are expected to rise slightly less but still see a significant increase due to rising renovation costs.

2.      Rising Construction Costs:

• The 25% tariff on softwood lumber could push lumber prices higher than other materials, resulting in up to 40% effective tariff rates.
• Other materials like steel, aluminum, and insulation will also face cost increases, leading to compounded financial pressure on builders and GCs.

3.      Regional Variations:

• Different provinces will experience varying impacts based on their reliance on imported materials. For instance, British Columbia (BC) could see the largest price increase, while provinces like Saskatchewan (SK) and Newfoundland & Labrador (NL) may face lower but still significant hikes.

4.      Inter-Provincial Collaboration:

• A significant opportunity exists in fostering inter-provincial trade to reduce costs and mitigate the impact of tariffs. By removing trade barriers between provinces, the cost of construction could drop by 7-18%, and housing supply could increase by 15-18% in key areas.
• This collaboration could stabilize housing prices, increase market efficiency, and make housing more affordable.

Quickly’s Role in Addressing These Challenges:

• Quickly offers innovative financial solutions that help builders and GCs manage rising costs and navigate economic uncertainty.
• By leveraging technology for dynamic early payment options, builders and GCs can unlock immediate savings to offset material costs, reduce trade payables, and maintain project timelines.
• Quickly’s solutions also empower builders and GCs to stay flexible and responsive to fluctuating market conditions, ensuring continued project success even amid rising input costs.

Conclusion:
The Canadian housing market is facing a period of increased economic uncertainty due to tariff negotiations, but proactive strategies, including inter-provincial collaboration and leveraging technological solutions like Quickly’s early payment system, can help builders and GCs adapt to rising costs and maintain project profitability.

For more information or to discuss how Quickly can help your business navigate these challenges, contact Kyle Friedman at Quickly.

About Robert Price:
Robert Price is a Founder and the CEO of Bōde, an online real estate marketplace that launched in Alberta in 2019 and rapidly expanded to British Columbia and Ontario selling 2,000+ homes from homeowners and over 50 builders across Canada. He has brought together a seasoned team that is turning the traditional real estate industry upside down, as one of Calgary’s Top 15 most innovative companies in 2020 and top 50 most promising businesses by Alberta Innovates. Bōde directly connects buyers and sellers to work out a deal with ease while saving tens of thousands of dollars fully online.

About Kyle Friedman:
Kyle Friedman is the founder and CEO of Quickly, a company revolutionizing cash flow management for the construction industry. With a background in the trade industry, Kyle has firsthand experience with the challenges suppliers face regarding early payments. Under his leadership, Quickly has become a leading provider of dynamic early payment solutions, helping builders and general contractors become more profitable while strengthening their supply chain.