Canada's retaliatory tariffs on $20 billion worth of American goods, set to take effect Tuesday, Sept. 8, could push construction costs higher in Ballantyne, where more than 1,200 new homes are in various stages of development.
UNC Charlotte economics professor Matthew Metzgar told WCNC on Tuesday, Aug. 25, that Charlotte's housing market is especially vulnerable because the region's construction industry relies heavily on Canadian lumber and building materials.
"Something that could affect North Carolina and Charlotte more could be the housing because the housing industry there's lots of new construction around Charlotte," Metzgar said.
The tariffs impose duties of 50% on steel, aluminum, furniture and clothing; 25% on cheese, appliances and some seafood; and 15% on electronics and tools, according to Reuters. Canada's full product list also includes plywood, a key building material.
Why Ballantyne feels it
Ballantyne is in the middle of a construction wave. Northwood Investors has broken ground on a 37-acre, 486-home development expected to finish in 2028, is designing a second residential tower at The Bowl that could add 356 apartments, and is in early planning for 411 residences at 10840 Ballantyne Commons Parkway, according to Axios Charlotte.
That construction depends on Canadian supply. Nationally, up to 30% of softwood lumber consumed in the U.S. each year comes from Canada, according to NC State University associate professor of forest economics Rajan Parajuli. Canadian softwood lumber accounts for approximately 80% of all U.S. softwood lumber imports, according to the National Association of Home Builders.
Canadian softwood already faces a 45% combined duty rate after antidumping, countervailing and Section 232 tariffs imposed earlier this year. Canada's new retaliatory tariffs add another layer of uncertainty to the cross-border supply chain.
Affordability already strained
The Charlotte metro is among the most strained housing markets in North Carolina, where a median-priced home consumes close to 40% of the typical household's income. The North Carolina Housing Finance Agency estimates a shortfall of roughly 764,000 housing units over the next five years.
Metzgar said even a 10% increase in vehicle prices could be difficult for many households to absorb. President Trump threatened Monday, Aug. 24, to impose 50% tariffs on Canadian automobiles and car parts beginning Jan. 1, 2027.
History suggests tariffs may not last
Metzgar pointed to a similar U.S.-Canada trade dispute in early 2025 that lasted roughly three to four months before tariffs were negotiated down.
"Historically a lot of these large increases in tariffs tend to get negotiated and come back down in a short period of time," he said.
Still, no deal is imminent. Canada announced the retaliatory tariffs Tuesday, Aug. 25, after trade negotiations collapsed over the weekend. Canadian Finance Minister François-Philippe Champagne called the U.S. terms "uneconomic, unfair, and ultimately unacceptable." No further negotiations between the two countries are scheduled.
