Development community concerned as tariffs affect building materials on Vancouver Island

Housing supply and affordability are major concerns for many on Vancouver Island, and there’s a new factor that could negatively affect construction – Canada’s counter-tariffs on U.S. building materials.

Joshua Farquharson, the general manager of Windsor Plywood Victoria, said he’s beginning to see the repercussions of the trade war.

“We’ve had tariffs now on three orders, but I think there is more coming down the pipeline,” said Farquharson.

The manager said his two stores are in a decent position to avoid most tariffs as during the pandemic, when supply chains were disrupted, a conscious effort was made to source as many products from Canadian suppliers as possible.

But in some cases, he said, there simply isn’t an alternative.

“We just don’t have certain species of wood that grow here in terms of hardwood, and certain glues only get produced down there,” said Farquharson.

The tariff uncertainty is causing a ripple effect throughout the development community, according to Georgia Desjardins, vice-president of development at Seacliff Properties.

“The potential for increasing construction costs is obviously top of mind,” said Desjardins.

That would translate into increasing home prices and potentially stall out some projects all together, she said.

Seacliff Properties, in partnership with Reliance Properties, is beginning to develop The Beachlands in Colwood. It’s a massive project spanning 134 acres in size that will see 2,850 homes built over the next 15 years. As to what extent tariffs will have on the project, Desjardins said that is still an unknown.

“We are closely monitoring that situation and ultimately we will be having to review what those implication are to the end home prices,” said the vice-president. “It’s a difficult time and very difficult situation to be managing through.”

Casey Edge with the Victoria Residential Builders Association said British Columbia’s housing crisis continues with the highest prices in Canada. He said recent data shows that the problem is only getting worse.

“In Greater Victoria, we’re down about 33 per cent year-to-date (in housing starts), according to CMHC,” said Edge.

Canada’s counter-tariffs on building supplies coming into this country from the U.S aren’t helping the situation, said Edge, who believes governments of all levels are to blame for the affordability problem.

“Housing has become a cash cow for governments,” said Edge.

There are municipal development cost charges, a provincial property transfer tax, and federal GST, to name a few factors adding to the cost of housing. Now tariffs are in play.