A surprising housing story came out on September 24. CMHC says U.S. tariffs on Canadian lumber could actually leave more Canadian wood available for homebuilding here at home. If builders use more domestic wood products, CMHC estimates construction costs for some ground-oriented homes could fall by as much as 17% in certain markets.
Why does this matter for GTA buyers? Detached homes, townhouses, and other wood-heavy housing types are among the most expensive homes to build. If material costs come down meaningfully, some projects that no longer made financial sense could become easier to build.
That does not mean home prices in the GTA are about to drop 17%. Land, development charges, labour, financing, and other costs still make up a large part of the final price. But lower construction costs could improve the economics of future projects and eventually help increase supply.
For sellers, this is more of a long-term story. More new construction could create additional competition in certain areas, but any effect would take time. For buyers thinking two or three years ahead, however, this is worth watching because construction costs directly influence what actually gets built.
The interesting takeaway is this: a trade problem that sounds bad for Canada could unexpectedly help housing supply. If builders can use more Canadian materials at lower cost, some of today’s stalled projects may become easier to move forward.
Source: Canada Mortgage and Housing Corporation (CMHC), September 24, 2026.