The US has imposed new tariffs on imported wood, furniture, and kitchen cabinets, effective immediately. The move, aimed at boosting US industries and protecting national security, is expected to increase building costs and put additional pressure on homebuyers in an already challenging market. According to the White House, the tariffs are part of a broader effort to protect US industries and will affect various countries, including Canada, Vietnam, and China.
The tariffs include a 10% duty on softwood lumber imports, with duties on certain upholstered furniture and kitchen cabinets starting at 25%. These rates are set to increase on January 1, with the rate on imported upholstered furniture rising to 30% and those on kitchen cabinets and vanities jumping to 50%. However, duties on wood products from Britain will not exceed 10%, and those from the European Union and Japan will be capped at 15%.
The National Association of Home Builders has warned that the new tariffs will “create additional headwinds for an already challenged housing market” by further raising construction and renovation costs. US home sales have been sluggish in recent years, with high mortgage rates and limited inventory pushing costs up for buyers. The Trump administration has imposed the tariffs under Section 232 of the Trade Expansion Act of 1962, the same authority used to roll out steel, aluminum, and auto duties.
Canada, the top supplier of lumber to the US, is expected to be significantly impacted, with the 10% lumber tariff adding to existing anti-dumping and countervailing duties. The BC Lumber Trade Council has called the new tariffs “misguided and unnecessary,” warning that they will impose strain on the North American market, threaten jobs, and make it harder to address the housing supply crisis in the US. According to Stephen Brown of Capital Economics, the tariffs could raise the cost of building an average home by $2,200, with Vietnam potentially facing the biggest impact due to its significant furniture exports to the US.
