In his effort make America first, President Trump has announced that he plans to levy a tariff on the import of softwoods from Canada. Softwoods include pine, spruce and fir, most of which is used in the construction of new homes. This move has a some Wall Street folks concerned that the tariff will result in higher lumber prices which in turn would result in higher costs to home builders which will lead to higher costs of new homes.
President Donald Trump’s administration plans to slap tariffs on imports of Canadian softwood lumber, raising concerns on Wall Street that home builders will face higher costs.
Softwood lumber, which comes from pine, fir and spruce trees, is used in home construction. Taxes on Canadian imports are expected to increase the cost of lumber for home builders, thus weakening profits.
While the broader market rallied Tuesday, shares in the nation’s top home builders retreated…
If the cost of building and buying a new home increases too much, fewer people will be able to build and buy. This could have a negative impact on the entire US economy. However, if Trump can lower corporate and middle/lower class tax rates and create more jobs, the economy could still flourish with more Americans working and thus possibly being able to afford to build or buy a home.